Category: Information and Advice

If you are in the process of buying your next home, you know how long and arduous the journey can be. Once your offer price has been accepted and solicitors have been instructed, there’s still plenty that can go wrong before contracts are exchanged – and that includes gazumping.

Research carried out by finance provider MFS in 2020 showed that 31% of UK homebuyers (47% in London) over the last 10 years had experienced gazumping and lost out on a home purchase as a result, and the trend is set to continue as the market grows.

Let’s take a closer look at the dreaded practice and how you can protect yourself.

What is gazumping?

Gazumping happens when another buyer makes a higher offer for the property on which you have agreed the purchase. If the seller accepts the higher offer, you lose the property and any money already spent on it, which could include legal, surveyor and mortgage fees.

Reasons for gazumping can vary. Perhaps the seller has realised they can get a better sale price elsewhere, or you are taking too long to commission a home survey thus denting your credibility as a buyer, or perhaps your solicitor is slow to communicate and the seller has found a buyer who can move more quickly.

Is gazumping legal?

While gazumping may well be considered sharp practice, it is indeed perfectly legal. When your offer is accepted, the property is ‘sold subject to contract’ (SSTC). The property transaction does not become legally binding until contracts have been exchanged. As a buyer, you are vulnerable to gazumping at any time before that date.

Since exchanging contracts comes fairly late in the home buying process, and only takes place after the mortgage has been agreed, survey findings have been digested and local searches have been carried out, gazumping can be both hugely frustrating as well as financially painful.

How can you guard against gazumping?

Estate agents have a legal duty to pass on any offer they receive, so the first and most important thing you must do is to get the property taken off the market. Make it a condition of your offer that all marketing and advertising of the property ceases with immediate effect. If no-one else views the property, chances of a higher offer being made and you being gazumped are greatly reduced.

Once an offer has been accepted, it is assumed that both parties want to get on with the conveyancing process as soon as is reasonably possible. As a buyer, it is therefore in your best interest to be prepared and ready to proceed. This means having a mortgage in principle in place, a solicitor on stand-by ready to start the conveyancing, and all the necessary documents at your fingertips to avoid any unnecessary delays that could have the potential to derail the sale.

Appointing a surveyor and arranging for an inspection visit is usually the next step in the process. As RICS accredited Chartered Surveyors offering the full range of RICS endorsed home surveys, Able Surveyors are ideally placed to help you get the insights you need so you can make an informed purchase decision. Our surveyors are knowledgeable and highly experienced in property markets in London and Essex. Contact us here to arrange for a free no-obligation quote. London homebuyers can obtain an instant online quote here.

Keep the momentum going and do whatever you can to move the process towards exchange of contracts swiftly. You want to get contracts exchanged as soon as possible to have the legal certainty that your purchase is going ahead. Make sure that you are in regular contact with your mortgage provider and your conveyancing solicitor so that requests for information can be responded to quickly. Also, keep the estate agent in the loop; it’s in their interest to keep up the pressure on the seller.

It’s also worth building up a rapport with the seller. While the formal sale will be in the hands of the solicitors, and the estate agent serves as a go-between, there’s no harm in having a direct line of communication to the seller. That way, you can keep them informed of where you are in the conveyancing process and show that you are actively moving things along. If you get on well and they can see that you are a serious buyer who genuinely loves their home, they will feel more inclined to honour the deal in hand.

Finally, did you know that you can get home buyer protection insurance to protect yourself against a house sale falling through? While there may be nothing much you can do about a seller changing his mind or accepting another offer, at least you can mitigate the financial loss by claiming back some of your conveyancing fees, survey fees or any other expenses incurred on an abortive sale.

At Able Surveyors, we have over 25 years’ experience in helping home buyers in London, Essex and the Home Counties get the most out of their property purchase, and we would be delighted to do the same for you. For further information please get in touch.

If you are the owner of a leasehold property and the number of years remaining on the lease is approaching 90 years, you may want to think about a lease extension. Under the provisions of the Leasehold Reform, Housing and Urban Development Act 1993 (the Act), residential leaseholders have a statutory right to extend their lease. However, the process is often long-winded and potentially expensive, so it should be no surprise that many leaseholders are eager to explore alternative routes.

At Able Surveyors, we have over 25 years of experience in all aspects of building surveying and associated property services. Our team offers valuable professional advice including lease extension surveys and valuations and can help you increase the value of your leasehold asset. As trusted building surveyors in London and Essex, please feel free to discuss your property with us.

What are the differences between a formal and informal lease extension?

Briefly, a formal lease extension follows the statutory process set out under the Act. This must be initiated by the leaseholder serving a Section 42 Notice on the freeholder, and putting in an offer to extend the lease by 90 years with no future ground rent. The offer will be based on a professional leasehold valuation carried out by a surveyor, while negotiations will involve lawyers for both parties. After much to-ing and fro-ing, an agreement is eventually reached on the premium to be paid. Visit our recent blog for more information about statutory lease extensions.

The advantages for leaseholders taking the statutory route include:

• You will receive a guaranteed lease extension of 90 years which will be added to the number of years currently remaining.
• The term remaining on the lease is ‘frozen’ once formal proceedings have started, so there is no danger of the premium increases as the term decreases.
• Once your lease is extended, your future ground rent obligations will be reduced to zero.
• The premium payable for your lease extension is usually better value for money than can be achieved by an informal agreement with the landlord.

Informal lease extensions don’t need to follow the same process. A leaseholder will normally approach the landlord in writing with a request for a lease extension on terms to be agreed upon. These terms can differ widely: the number of years added to the lease will typically be less than the statutory 90 years, and ground rent clauses will remain or may even increase. The advantages of choosing an informal route include:

• To qualify for a statutory lease extension, you must have owned the property for at least 2 years. No such eligibility criteria apply for informal lease extensions.
• The cost of serving a Section 42 Notice is around £220, which constitutes a small cost saving if you conclude an informal agreement instead.
• There is tremendous scope for flexibility in negotiations. If, for instance, the premium is unaffordable, a lower additional term and keeping the ground rent in place could be a palatable alternative solution.

Are there any disadvantages to extending your lease informally?

The main issue with an informal lease extension is that these private agreements, though perfectly valid in law, are not bound by the provisions of the 1993 Act, meaning that all of the terms of the new lease may be open for renegotiation.

This creates a situation that could be exploited by unscrupulous freeholders, particularly if the leaseholder has insufficient access to professional advice. It is sadly not uncommon for landlords to take advantage of the power imbalance, with many lease extensions negotiated based on a shorter extension and with some ground rent retained.

When approaching a freeholder on an informal basis, you should expect a request for payment to cover the landlord’s administrative and valuation costs. It is also likely that the freeholder’s offered premium will be significantly inflated, compared to the amount calculated as part of the statutory process. This can leave the leaseholder with little option but to accept the landlord’s onerous terms, or break off negotiations and commence the formal route from scratch.

Which is the best route to take?

While both lease extension routes have their pros and cons, the advice on which is more suitable depends on your situation. If you have owned the property for two or more years, it makes sense to commence matters through the formal route, benefitting the full protection offered through the statutory process.

We strongly recommend that you always instruct a professional surveyor to conduct a lease extension valuation and serve the Notice on your behalf. Even if you start going down the formal route, there is nothing to stop you from reaching an informal agreement at any stage of the process – effectively giving you the best of both worlds.

If, however, you have not owned the property for the required two years, and the remaining lease term is less than 82 years, it may make more sense to approach the freeholder informally to negotiate a quick deal.

Contact Able Surveyors – London and Essex

For any questions regarding lease extensions in London, or to discuss your particular property needs in Battersea, Bromley, Brentwood and beyond, please feel free to contact the Able Surveyors team.

Do you own a leasehold property, typically a flat or maisonette? The number of years left to run on the lease are a key component of the property’s market value, and there may come a time when a lease extension would make sense. So, what can you do?

Many leaseholders are unaware that they have a legal right to extend the lease on their property. Should you decide to approach the freeholder or the management agent direct with a request for a lease extension, chances are that they may offer you a restored 99-year term and revised ground rent clauses in return for a non-negotiable premium to be paid. But don’t be in a hurry to accept their terms because you may be able to do better.

If you have owned the property for more than two years and meet certain other eligibility criteria, you have the right to a statutory lease extension under the terms of the 1993 Leasehold Reform Housing & Urban Development Act. What does it all mean? Let’s take a look at some of the key questions you should be asking.

1. Why would you want to extend the lease term?

By default, leasehold property is a depreciating asset. As the lease runs down, the value of the property decreases, while the cost of any lease extension increases. Ultimately, when the lease term expires, property ownership reverts back to the freeholder, though this rarely happens in practice.

An unexpired term of 80 years or less is considered by many to be unacceptable, since it makes the property hard to mortgage, remortgage or sell on. Mortgage companies have specific lending criteria and many simply refuse to provide the funds for a property of less than 70 years or so to run (exact figures vary between lenders).

2. What does a statutory lease extension achieve?

A statutory lease extension provides a 90-year extension on top of the existing unexpired lease term. Say your lease has 74 years remaining, a statutory lease extension will give you a new term of 164 years. In addition, ground rent will be reduced to zero for the duration of the lease, while the premium payable to the freeholder is determined by Schedule 13 of the Act.

Finally, if you extend your lease before the unexpired term has reached 80 years, no marriage value (50% of the difference in value before and after the lease extension) is payable as part of the premium, thus further reducing the amount due to the freeholder.

3. Are you eligible for a statutory lease extension?

In order to qualify for a statutory lease extension, you must have owned the property for at least 2 years, while the lease term must have been more than 21 years when it was originally granted. How many years are left to run on the lease is not relevant. The legislation only applies to residential property, not a business or commercial lease. Importantly, the property will not qualify for a statutory lease extension if the landlord is a charitable housing trust and your flat is provided as part of the charity’s work.

If you are in the process of buying a short-lease property, there is a way to get around the 2-year ownership clause. Assuming the seller has owned the property for more than 2 years, he can initiate the statutory process and assign the benefit to you as part of the contract of sale.

4. How do you start the statutory lease extension process?

To get the ball rolling, a lease extension valuation must be carried out on the property in order to determine how much to offer the freeholder, and to give you an idea of the financial liability involved. Once this has been done, your solicitor will serve a formal S42 Notice on the freeholder to initiate the process.

The freeholder than has 2 months in which to serve a Counter Notice, which will typically request a higher premium payment. Thereafter follows a 6-month negotiation period to reach agreement, though either part can refer the matter to the Leasehold Valuation Tribunal (LVT) after 2 months. In our experience, the vast majority of cases are settled without the need for a formal hearing. It should be noted that you will be responsible for the freeholder’s valuation fee and legal fees as well as your own.

5. How can Able Surveyors help?

As experienced lease extension surveyors in London and the Home Counties, Able Surveyors can help you navigate this complex procedure, ensuring that fair freeholder compensation is negotiated. We specialise in carrying out the requisite lease extension premium valuations, entering into negotiations with the freeholder on your behalf and, where necessary, preparing for and representing your interests at Tribunal.

If you have any questions about extending the lease on your property, need advice on buying a freehold property or would like expert assistance with any surveying matter, please don’t hesitate to get in touch.

Are you looking to buy a flat, either for your use as a home or as a buy-to-let investment? Flats including apartments and maisonettes are generally sold on a leasehold basis, and the length of the remaining lease has a big impact on the property value. The price of a short-lease property, therefore, may be appealing. However, before you go ahead with the purchase of a short-lease flat, it is highly recommended that you do your homework to fully understand the legal and financial implications you are taking on.

What constitutes a short lease?

Residential leasehold properties usually have an initial lease term of 99 years or more. 125 years and even 999 years are also quite common. Properties with less than 70-80 years left to run are generally regarded as having a short lease. Of course, this doesn’t prevent these types of flats from being sold. Properties with leases of as little as 5 years or less remaining still happily change hands.

That being said, the point is that leasehold property is, by definition, a depreciating asset. This means that ownership of the property will revert to the freeholder once the lease term has expired unless the lease is extended in time.

How to extend a short lease

The good news is that leasehold owners have a statutory right to extend the lease of their property under the Leasehold Reform, Housing and Urban Development Act 1993. “A lease extension under the 1993 Act gives the leaseholder the right to an additional 90 years on top of their remaining term at a peppercorn ground rent,” explains one expert in the field.

To qualify for a statutory lease extension, the original lease term must have been at least 21 years, and the leaseholder must have owned the property for at least 2 years. Of course, this is of little use to a prospective buyer, but all is not lost. If the seller fulfils the eligibility criteria, you can request that they initiate a statutory lease extension as a condition of purchase. This benefit can then be assigned to you on completion of the sale.

Outside of the statutory framework, there is nothing to stop the leaseholder from approaching the freeholder with an informal request for a lease extension. In this scenario, there’s no need to wait 2 years and any private agreement reached between the leaseholder and freeholder will be perfectly valid in law, albeit without the statutory protection.

Should you let the lease run down?

A lease extension is not always the right course of action; there are certain circumstances where it might make sense to let the lease run down. Short-lease flats may be an attractive option for retirees and homebuyers who have no one to leave their estate to after death, meaning they don’t need to worry about protecting the value of their property asset.

Short-lease properties can also make very attractive buy-to-let investments. The profit made from renting out the flat for the remainder of the lease term can amount to a multiple of the initial purchase price. Once the lease is up, the property reverts to the freeholder.

That said, short-lease flats are often in a poor state of repair and may require extensive (and expensive!) refurbishments before they become viable rental property, while service charges and ground rent may be considerable. Make sure you know exactly what you are buying.

Can you get a mortgage for a short-lease flat?

Unfortunately, it is rather difficult to obtain a mortgage for a flat with a short lease. Lenders typically refer to the years remaining on the lease as the ‘minimum expired lease term’ and the shortest term acceptable will vary between mortgage companies. The majority of lenders consider a short lease to have fewer than 75-85 years remaining. “You may be able to find a provider willing to lend on a 65-year lease, but this is very rare,” advises one mortgage comparison website.

Speak to an experienced mortgage broker to investigate all possibilities including specialist lenders and shorter mortgage terms, and be prepared to pay much higher mortgage interest rates to cover the lender’s additional risk.

What are your options?

Given the difficulties of securing a mortgage, short-lease flats tend to be sold at auction rather than through the traditional estate agent route. Auction buys can be financially attractive and if you can pay cash for the flat, it could make the property a good investment.

However, don’t forget to factor in the cost of having to extend the lease yourself, which can be substantial. The shorter the remaining term, the higher the cost of a lease extension. If you include lawyers’ and surveyors’ fees, the cost can run into £10,000s for a property with 60-70 years left, rising steeply for shorter leases. Here’s a handy calculator to help you do the initial sums.

Your best option would be to ask the seller to initiate statutory lease extension proceedings before the completion of sale and come to an agreement regarding cost sharing.

The property transaction won’t become legally binding until contracts are exchanged, and before that happens, we urge you to commission an independent home survey. With one of our experienced building surveyors investigating the condition of the property and delivering their findings in a detailed report to you, you can make key decisions on whether and how to proceed with the purchase.

Bad survey results

Speaking from many years of experience in the property surveying business, it is by no means unusual for a survey to flag up problems with the building that the buyer is unaware of. From structural issues such as subsidence, damp, timber and roof defects to invasive garden species including the dreaded Japanese knotweed, a bad survey result can certainly take the shine off your new home.

If you decide to go ahead with the purchase with full knowledge of the facts, you may want to reconsider the price in light of the survey findings – and you are absolutely within your rights to do so. Your offer to purchase is ‘subject to contract’, which includes the results of any survey that is undertaken. If defects in the construction are identified, or our surveyors have highlighted that repairs are needed, then these will affect the property value.

How will the vendor and their agent react?

Estate agents are a hardy sort; they’ve probably seen every conceivable building problem under the sun and are unlikely to be fazed by your request to renegotiate the price on account of a ‘bad’ survey result.

What’s more, the agent won’t have been aware of issues with the property when they valued it for sale, so when new information comes to light that has a bearing on the value, asking for a discount is not an unreasonable request.

The vendor and their estate agent should certainly not dismiss your concerns. After all, you could pull out of the transaction at any point before contracts are exchanged – do they want to risk losing you as a buyer? And if the property does go back on the market, other buyers are bound to find the same defects.

How to renegotiate a previously accepted offer

If you are serious about asking for a discount, don’t just tell the estate agent over the phone and ask them to pass the message on to the vendor. Instead, take the formal route and put your request in writing, explaining that you are putting forward a new offer as a result of the findings provided by an independent RICS Chartered Surveyor.

It is worth emphasising in your letter that you are still very much committed to the purchase, but that you are not prepared to pay the full agreed price when serious defects were found and repairs are needed. You can also add a polite note to say that other buyers would face the same problem.

Hopefully, the vendor will realise how inconvenient, time-consuming and costly it would be to have to find a new buyer and be motivated to accommodate your request.

What your letter should contain

Your best approach to successfully renegotiate the purchase price with the seller is to construct your arguments on evidence-based facts and deliver these politely but clearly.

• List all the serious defects highlighted in the property survey along with their associated costs of repair, such as are included in our Level 3 RICS Building Survey.
• By way of evidence, it’s worth providing a copy of the specific pages of the survey report that relate to the repairs. There’s no need to supply a copy of the whole survey to the estate agent or the vendor.
• Total the costs and decide on what you would consider a reasonable discount off the original accepted offer price. You may decide to claim the entire cost of repairs or come to a cost-sharing agreement with the vendor.
• To strengthen your proposal and renegotiation chances still further, include the name of any contractors who have given quotes.

In receipt of your fully considered proposal, the seller will now need to consider their options and get back to you within a few days, so as not to risk derailing their sale. All you can do now is to keep your fingers crossed and remain flexible in reaching a mutually agreeable outcome to your negotiations so that your home purchase can stay on track.

At Able Surveyors, we have 25+ years of experience providing expert advice and guidance to prospective home buyers to help them make the right decision, and we can assist you too. Contact us to discuss your specific requirements and let us advise on the best choice of RICS home survey – HomeBuyer Report or Building Survey. We look forward to hearing from you.

Subsidence is one of those fearful words that no homebuyer wants to hear. But what exactly does it mean for the property, and what can you do about it? At Able Surveyors, we are experienced at detecting signs of subsidence in properties of all ages. Our professional service portfolio includes the full range of RICS home surveys, meaning we can advise you of major faults and building defects before you proceed with the purchase. In addition, we can provide ongoing monitoring services for newly detected cracks and other situations where the presence of structural movement in a building is suspected and must be confirmed (or ruled out).

What is subsidence?

In basic terms, subsidence happens when the ground on which the building stands begins to sink. Unstable foundations can cause the house to become askew and strained by the movement below. Structural damage can occur that calls into question the integrity of the building. While, ultimately, this could lead to the collapse of the structure, in practice subsidence can often be dealt with quite easily, particularly if the signs are spotted early on.

What causes it?

There are many reasons why subsidence may occur. Moisture plays a critical part and this can manifest in various ways. If the house is built on clay soil, for instance, the ground is likely to swell and shrink with rising and falling moisture content through the seasons. This can cause natural shifts which may well affect the building on top. Soils such as gravel and sand, on the other hand, won’t shrink or swell but could be at risk of being washed away as a result of extended periods of wet weather or, more likely, damaged underground drainage pipes.

The water content of the soil is also affected by trees, shrubs and bushes growing near the building. Plants draw up the moisture they need through their roots, leaving the soil drier and therefore more susceptible to shrinkage. The effect is obviously compounded on clay soils. Some trees such as willow, poplar, oak and elm are particularly thirsty and should always be situated at a safe distance from the house, and preferably not planted at all in a regular-sized garden.

Other causes of subsidence can include seemingly innocuous things like persistent traffic-induced vibrations and building work close to the house, long-term leaking underground pipes, and a history of mining in the area.

How to spot the signs

If there is subsidence, detecting it early will make remedial work much easier and potentially a lot cheaper. Tell-tale signs include cracks in the wall that appear suddenly and are:

• Generally larger than harmless plaster cracks (>3mm)
• Typically diagonal in nature, often being wider at the top than at the bottom
• Often situated around windows and doors, or where an extension joins the main building
• Visible on the inside and outside of the property

Drops in flooring is another potential indicator of subsidence. Uneven skirting boards, with gaps underneath, and uneven surfaces elsewhere, may all point to structural movement having occurred.

At Able Surveyors, our team have a keen trained eye and will be able to tell the difference between cracks that are perfectly normal and nothing to worry about, and signs of subsidence, which will be clearly documented in our survey report.

Should you buy a house with a history of subsidence?

Of course, the $64,000 question is whether you should run a mile from any house that has suffered from structural movement at some point, or whether it is OK to proceed with the purchase, and at what price. Our professional advice is to obtain all the salient facts before making your decision. To that end, we recommend that you:

• Have a full RICS Building Survey carried out to establish the nature and severity of any structural problems. The report will also contain our recommendations for remedial action along with cost estimates.
• Discuss the property with your mortgage broker or lender as a matter of priority. Lending criteria vary between mortgage companies, and additional checks will be necessary, while some may refuse to provide finance on subsidence affected properties altogether.
• Obtain proof from the seller that any historic subsidence issue has been fixed, including details of what was done (monitoring, underpinning etc) and when it was completed.
• Research home insurance options for properties with a history of subsidence. Standard home insurance cover may not be available, or only at exorbitant premiums, but there are many niche insurance providers who may be suitable.

What price should you pay?

While there is little doubt that a house afflicted by subsidence, past or present, will be worth less than a comparable property where structural movement is not an issue, it is difficult to put a clear figure on this. Every property is different, and it is up to the seller and the buyer to negotiate a mutually agreeable purchase price.

This is where a RICS Building Survey can be hugely helpful to the buyer. Armed with the detailed report findings regarding the structural condition of the building, you are now in the best possible situation to make an informed decision, whether you choose to proceed with the transaction as planned, ask the seller to remedy the problem, renegotiate the price or walk away from the sale.

If you would like to discuss your next property purchase with our expert team, or get an instant survey quote, please contact the Able Surveyors team.

Property surveying is a complex technical discipline with information that is often hard to comprehend unless you are a Chartered Surveyor yourself. Little wonder, then, that there are many myths and misconceptions surrounding building surveys circulating among homebuyers who have no experience in the field. Let’s take a look at four of the most common wrongly-made assumptions and replace fiction with facts.

1 – You don’t need a property survey if you have a mortgage valuation

One of the most common falsehoods is the belief that a mortgage valuation is enough. Please be warned that this is not the case. A property valuation carried out on behalf of your lender is for their benefit only; its sole purpose is to ensure the property is worth the loan you are applying for. Often little more than a tick-box exercise performed during a brief site visit, it gives next to no information about the condition of the property, and you may not even get to see a copy. An independent property survey such as the level 2 RICS HomeBuyer Report or RICS Building Survey, on the other hand, is an impartial inspection of the property to assess its condition, carried out on your behalf to protect your investment.

2 – A survey is nice to have but the money could be better spent elsewhere

Unfortunately, many homebuyers still believe that an independent property survey is a needless expense. But think of it this way: you wouldn’t buy a car without giving it a thorough once-over first, so surely the same principle applies to what could well be the biggest financial commitment you will ever make? A survey may cost a few hundred pounds but the findings may include hidden and unexpected defects that may cost thousands to rectify later on. It could even flag up serious issues that may make you change your mind about the purchase, or the price. Rather than a needless expense, think of a property survey as due diligence to ensure you’re making a sound investment.

3 – Survey reports are deliberately vague to cover the surveyor’s back

Another cynical misconception is that survey findings are purposefully reported in an unclear fashion so as to protect the surveyor from any legal action if problems are later uncovered that should have been flagged up in the survey. With a reputable and experienced firm of RICS-accredited Chartered Surveyors such as Able Surveyors, that won’t be the case. We meticulously inspect every property and deliver a comprehensive and detailed report of the condition of the property. Our aim is to provide you with full feedback, including implications of any defects found, so that you have all the information you need to make an intelligent purchase decision.

4 – I won’t be able to understand the survey report, so there’s no point having one

At Able Surveyors, we offer the full range of RICS home surveys –including RICS HomeBuyer Reports and in-depth RICS Building Surveys – as well as a range of specialist investigations. Our reporting follows a standardised structure and clear, jargon-free language to enable everyone to understand the findings and their implications. We will go the extra mile to ensure that you fully understand all the information presented, offering opportunities to discuss the survey findings with our surveyors and obtain plenty of professional advice and guidance from our competent, friendly team.

If you are thinking of buying a property, don’t make the mistake of skipping the survey – you could regret the decision in years to come. An independent home survey is the best way to provide you with the peace of mind that your investment is sound. At Able Surveyors, we can advise on the best choice of property survey for your needs, answer any queries you may have and provide an instant quote. Please feel free to get in touch.

Buying a home is a big investment, probably one of the biggest in your life. Being a freeholder means you own the building and the plot of land it stands on, but leasehold is a different type of property ownership. When you buy a leasehold flat, you own the right to occupy the property (subject to the terms of the lease) for the length of your lease agreement with the freeholder.

Leases can be complex documents, often written in archaic legalese that are difficult to understand. But since the Lease is the basis on which the contract between you and the seller is drawn up, it pays to be vigilant. We’ve put together 5 important questions you should be asking before you go ahead with your purchase.

1 – How many years does the Lease have left to run?

The number of years left on the Lease will have a direct bearing on the value of the property, so this is one of the first bits of information you need to find out. In theory, once the Lease has run out, property ownership reverts to the freeholder, though it rarely comes to that. Still, the threat is real.

In particular, if there are less than 80 years left to go, this can affect your chances of getting a mortgage and you may well struggle to sell the property further down the line. While you have the statutory right to extend the Lease, this can turn out to be eye-wateringly expensive for properties with less than 80 years remaining.

We would recommend that you only shortlist properties to buy that have a remaining Lease term of more than 90 years, or have an arrangement in place for a lease extension as part of your purchase.

2 – How easy is it to extend the Lease?

By law, you have the right to extend the lease of your property by 90 years, while reducing ground rent to zero. However, you need to have owned the property for at least 2 years to be eligible and there are certain situations where a property may be exempt from statutory obligations. Make sure you get clarity before you sign on the dotted line.

That said if you are planning to extend the lease, be advised that this can be a lengthy process with the potential for things to go wrong. From absent freeholders to failing to agree on the premium to be paid, delays are certainly not uncommon. There is a set statutory process to be followed and, if all else fails, you have recourse to a tribunal. But this is a slow and expensive journey.

Our advice is to involve an experienced lease extension surveyor at an early stage. At Able Surveyors, we are happy to help with expert advice and a professional lease extension survey and valuation to help reach an agreement with your freeholder.

3 – How much is the annual Service Charge?

The day-to-day management of leasehold flats typically falls to a management company or residents’ committee. Each flat in the building will be required to pay a service charge for the upkeep of any common or shared areas including roofs, stairwells, lifts, external elevations and communal gardens.

Currently, there is no cap on how much the service charge can be, and levels can vary widely. It makes good financial sense to find out how much you will be charged compared to similar properties in the area.

Your annual payment may include a contribution towards a reserve or sinking fund, which is there to cover unexpected capital expenditures such as a new roof or heating installation. This is good practice as it protects individual leaseholders from sudden demands for large payments, instead helping to smooth cash flow.

4 – What about the ground rent?

In addition to an annual service charge, you will also have to pay a yearly ground rent. Again, this can vary from ‘a peppercorn rent’ to punitive formulas enabling the amount to double every 10 or 15 years, amounting to thousands of pounds.

Soaring ground rents were at the heart of the ground rent scandal a few years ago, with many leasehold owners effectively trapped in unsaleable properties because they didn’t realise what they were signing up for when they bought their homes.

Your conveyancer should review every aspect of the Lease and associated documents with a fine tooth comb, checking for risky ground rent clauses. It should go without saying that it is unwise to commit to the property unless these onerous clauses can be removed.

5 – Do you need freeholder permissions?

If you are thinking of buying a leasehold ‘doer-upper’ and are looking forward to refurbishing the property, it is important to find out in advance what you can and can’t do. The Lease will be your first port of call. For alterations, you are permitted to undertake you will need to obtain a Licence to Alter from the freeholder, and you may also need Planning Consent from your local authority.

A fee will be payable to the landlord, and you will also be responsible for any legal and surveyors’ fees incurred by the freeholder, which can make the entire project financially unviable. Make sure you do your homework and crunch your numbers to ensure you will able to realise your plans for the property.

At Able Surveyors, we have more than 25 years of experience providing building surveys and other property management surveys to a broad client base in London and the Home Counties. To discuss your leasehold purchase with our expert team, please don’t hesitate to get in touch.

Buying your next home can be an exciting journey, but resist the temptation to fall in love with your dream home. Properties presented for sale may not be what they seem, and it’s the job of your building surveyor to find out if there are any issues you should be worried about. An independent property survey is your due diligence safeguard – don’t skimp on it!

The purpose of a professional building inspection and survey report is to point out the risks you could be taking with your investment, so you can make informed decisions. For most homebuyers, buying a property will be the biggest financial commitment they will ever make, so you must ensure you get it right.

At Able Surveyors, we have over 25 years experience of surveying residential properties in London and the Home Counties. As members of the Royal Institution of Chartered Surveyors, we offer a choice of RICS surveys including our popular HomeBuyer Report and full RICS Building Surveys, along with plenty of professional advice and guidance to help you with your purchase decision.

So, what do you do if the house of your dreams turns out to have serious problems? For sure, a ‘bad’ survey will be disappointing and frustrating for any homebuyer, but it doesn’t have to be the end of the road. You could look at it as an opportunity to get a better deal.

What serious issues might be found?

It is by no means unusual for the survey findings to include areas of concern, regardless of the age of the property. Some of the most common building problems revealed by a home survey include

• Damp issues and timber defects including wet and dry rot
• Roof problems and drainage issues
• Gas and electrics
• Structural movement including subsidence
• Japanese knotweed and other invasive species

Your survey report should explain the location, nature and severity of each problem, as well as the degree of urgency of any remedial action. If there’s anything you don’t understand, please don’t hesitate to ask us. The team at Able Surveyors are always happy to chat through the report after you receive it and answer any questions you may have.

What should you do next?

Once you’ve fully taken on board the survey findings and their implications, it’s important not to panic, but to consider your options calmly and rationally. You have four choices regarding how to proceed:

• Do nothing and carry on as planned

Finding a serious issue with the building doesn’t necessarily mean there’s a problem with your purchase. Perhaps you are buying the property as a renovation project? If the survey flagged up ancient electrics and plumbing services but you were planning to rewire and replace the central heating system in any event, maybe there’s nothing much to worry about. And, if the agreed sale price reflects the ‘poor’ condition of the building, then you can use the survey and any further investigations as valuable tools to help you draw up an accurate refurbishment budget and priority to-do list.

• Ask the seller to carry out repairs

Your second option is to share the offending survey findings with the seller and ask them to fix the problem before contracts are exchanged. You could even make it a condition of the contract that you will only move forward if, say, the leaky roof or faulty guttering has been dealt with. Be knowledgeable about the issue at hand and have an idea of how much it would cost to fix. A Specific Defects Report or further investigation by a specialist surveyor may help bolster your case. If the seller agrees, make sure you put a checking system in place to confirm everything has been done as promised.

• Renegotiate the price

However, if the problem is not a quick fix, or you would much prefer to tackle the building repairs yourself, you can ask the seller to reconsider the agreed price. One of the best things about a property survey is that it gives you greater bargaining power. With written evidence from an independent specialist to back you up and a clear idea of the costs involved to remedy the issue, you can request a discount equivalent to the amount it would cost to fix it. Of course, the seller is under no obligation to renegotiate, but with a bit of give and take, a compromise can usually be found.

• Walk away from the sale

Under English law, your offer to purchase the property is subject to contract, which means you are not legally committed to the transaction until contracts are exchanged. Talk to your surveyor to find out how much it would cost to fix the problem and whether any long-term ramifications could impact the property value or its saleabilities such as a history of subsidence, or a knotweed management plan. If, after careful deliberation, you think the survey findings constitute a dealbreaker, you are completely within your rights to simply walk away.

A bad survey result does not have to spell the end of your dream home, but you do have to be prepared to be honest with yourself and make some tough decisions in the face of the information that’s come to light.

Would you be prepared to lose the house if the seller won’t budge on the price? Would you accept having to pay the full price, despite the survey’s findings? While our surveyors can assist with detailed factual information and professional advice including general property surveys, Specific Defects Surveys, Damp Reports and many other property services, ultimately the final decision rests with you.

If you would like to discuss your next property purchase with our expert team or obtain an instant quote, please get in touch with Able Surveyors.

Thinking of buying a residential property? Whether you are a first-time buyer or a long-term property owner, consulting with a professional surveyor to obtain a home survey before you sign on the dotted line is a ‘must do’. What’s more, you should double-check that your surveyor is a member of the Royal Institution of Chartered Surveyors (RICS).

What is the Royal Institution of Chartered Surveyors (RICS)?

RICS is the world’s leading professional body for promoting and enforcing the highest international standards in land, property, infrastructure and construction. It is the pre-eminent organisation for professionals working in the UK property surveying industry.

RICS qualification and membership ensure the highest quality reporting and level of professionalism. That means peace of mind for you knowing that someone with extensive professional knowledge is casting their expert eye over the building you are thinking of purchasing. Why cut corners when you don’t have to?

What does a RICS surveyor do?

A RICS surveyor will inspect and report on the condition of the property you are about to buy. This will help you discover if there are any structural problems such as damp or subsidence, or any other unwelcome skeletons in the closet both inside and outside of the building.

Choose from the RICS surveys available – RICS HomeBuyer Report or RICS Building Survey – and get independent expert advice and guidance from a qualified, fully regulated and insured property expert you can trust.

All RICS surveyors will have undergone rigorous training to gain their qualifications, and they must follow a strict code of conduct when carrying out property surveys. Members must also keep up to date with the latest training and complete continuing professional development every year, ensuring that the high standards of their professional body are always being adhered to.

Why use Able Surveyors?

At Able Surveyors, we deliver comprehensive surveying services across London and the Home Counties. We’ve built our business around helping our clients to make informed decisions about buying and managing property assets.

Our Managing Director, Dean Davidson (MRICS) has 25+ years of experience in building surveys and property management for residential and commercial clients. He is a RICS Chartered Surveyor and also a member of the Chartered Institute of Building (CIOB). Dean and the team have extensive experience in residential property and can provide a wealth of professional guidance before you exchange contacts.

A RICS surveyor’s report could potentially save you thousands of pounds if serious building defects are discovered. A property survey can also present an excellent opportunity to renegotiate the asking price to cover the cost of any repairs that are highlighted in the survey. Using the services of a RICS surveyor such as Able Surveyors will give you the peace of mind you need when it comes to making the final decision about which way to proceed with your property transaction.

Able Surveyors offer a range of professional services, including a full menu of RICS home surveys. To discuss your particular property surveying requirements, please get in touch.