Leasehold Sale

The average cost for a straightforward residential leasehold sale is between £525 – £900 plus VAT (currently 20%) for properties up to a value of £1million.  Properties over £1million are charged at an agreed fee.  The costs are quoted on a fixed fee basis dependent on the property and the complexity of the transaction.  We have always adopted the policy of informing our clients of the anticipated fees applicable at the outset of their matter and our quotes are “to the penny” to assist our clients with their budgeting from the very outset.

The costs include all standard aspects of a conveyancing sale transaction including:-

• Taking your instructions and giving you initial advice before you commit to any unnecessary expenditure
• Review of Sales Particulars
• Obtaining office copies of title and related documents
• Review of title and lease and drafting Contract
• Completion of Property and Leasehold Information and Fixtures and Fittings Forms with client
• Issue of draft Contract papers, copy Lease and any accompanying documentation
• Raising standard form of Landlord enquiries and liaising with Landlord/Managing Agent as necessary to secure a prompt response and discharging their fees for the same
• Dealing with additional enquiries
• Agreeing form of Contract
• Dealing with all matters up to and including exchange of contracts
• Exchange of Contracts and notifying you of exchange
• Approving Transfer and replying to Requisitions on Title
• Preparing an apportionment statement for the buyer’s solicitor for Ground Rent and Service Charge having obtained up to date details from the Landlord/Managing Agent
• Drafting completion statement for seller
• Completion of Sale
• Repaying outstanding mortgage by same day electronic bank transfer (CHAPS)
• Settling Agents’ fees
• Accounting to client as to net sale proceeds by electronic bank transfer

Not included in the fixed fee:-

• The Landlord’s consent may be required, but not always.  Where such consent is required, the seller will be responsible for both the Landlord’s costs and those additional legal costs of his own (if any)
• The Landlord may need to enter into a Deed of Variation to rectify any defects in the Lease or to extend the Lease Term to satisfy the Buyer’s mortgage requirements.  Where such a Deed is required the Seller will be responsible for both the Landlord’s legal costs and those additional legal costs of his own.

Factors that could make the matter more complex and cause delays and may increase the fixed fee quoted can include, but are not limited to:-

• Time delay caused by Buyers or other parties in the chain
• Unclear instructions/Sales Particulars
• Defects in the title or Lease which require remedying prior to exchange of contracts
• Issues with Lease (eg lack of critical clauses in the original Lease which are required by all Lenders)
• Issues revealed by searches
• Issues revealed by enquiries
• Unreasonable delay from third parties providing documentation
• Client or Buyer not being based in the UK
• Use of foreign funds/Anti Money Laundering issues
• Environment issues
• Quality and availability of opponent – if there is a poor quality, or inexperienced, conveyancer on the other side or we are unable to receive prompt responses this may make any matter more time consuming and cause delay
• Increased risk
• Dealing with rent or service charge arrears
• Delays in obtaining information from Landlord/Managing Agent
• Issues relating to Management Company and/or Landlord – eg poor management, failure to prepare/file accounts, unusual Management Company structure, lack of finances or Reserve Fund
• Drafting of additional documents ancillary to the transaction such as but not limited to the following:-
  – Statutory Declaration/Statements of Truth/Deeds of Grant of Easements
• Dealing with a Lease Extension or Deed of Variation to rectify any other defects in the Lease to facilitate the sale
• Creating a new Lease out of a freehold title to facilitate the sale
• If Landlord’s prior consent or licence to assign is required
• Dealing with unregistered title queries
• Application for Adverse Possession
• Dealing with the Reconstitution of Title

Additional Disbursements

There are a number of disbursements, some of which are specific to leasehold sales only, that may need to be paid in addition to the above costs including:-

• Indemnity insurance (if necessary, cost will vary dependent on the type of policy)
• Administration charge for electronic transfer of funds (CHAPS) (£40 plus VAT for each payment)
• Landlord’s and Superior Landlord’s own administration, legal and surveyors’ costs
• Fee to the Management Company for Leaseholder Pack (these can range from £100 – £380)
• HM Land Registry fees (between £8 and £24)
• Case Management fee per transaction of £20 plus VAT for access to online Land Registry facilities to secure fee savings for clients
• Fees payable to Landlord/Managing Agents to secure the consent to the sale once all fees, ground rent and service charges have been settled
• In sales of Retirement Flats there are Contingency Fees and Transfer fees payable each of which usually amount to 1% of the sale price
• There are often leasehold structures where there are Managing Agents who deal with Service Charges and maintenance issues, and separate Managing Agents appointed by the Landlord to arrange collection of ground rent.  In such circumstances there will be a double fee payable for Information Packs from both. These costs can be substantial.  On completion, Notices may also be required by both with again a double charge with separate fees payable to each Managing Agent.  We will not know these details until provided by the appropriate Managing Agents but clients are warned to expect these additional costs (some of which can be substantial) which are not otherwise payable in the case of the sale of freehold houses.