Q. What does share of freehold mean?
A. Share of freehold is commonly associated with the purchase of a flat but does not mean that a flat is freehold. Instead it means that the holder of the lease also has a share in the ownership of the freehold and therefore the land on which the property/block stands. This is often in the form of a share in a limited company and the shareholders of that limited company are the owners of the flats in the block. It can be attractive to owners as it suggests a greater degree of control over maintenance and management issues.
Q. What is ground rent?
A. Ground rent is a regular payment required under a lease from the owner of a leasehold property, payable to the freeholder. Typically this amount increases over the term of the lease.
Q. What is a sinking fund?
A. A sinking fund is a sum of money set aside from service charges to cover future expenditure on a leasehold flat or maisonette. The amount varies but is designed to avoid unexpected and unaffordable charges to leaseholders when major works are required, like a new roof for a block of flats.
Q. What is stamp duty land tax (SDLT)?
A. Stamp Duty Land Tax (SDLT) is a tax generally paid on the purchase or transfer of property or land in the UK where the amount paid is above a certain threshold. SDLT is charged as a percentage of the amount paid for property or land when it is bought or transferred - unless there is a relief or exemption. The current costs are set out below.
|
Purchase price/lease premium |
SDLT rate |
|---|---|
|
Up to £125,000 |
Zero |
|
Over £125,000 to £250,000 |
1% |
|
Over £250,000 to £500,000 |
3% |
|
Over £500,000 to £1 million |
4% |
|
Over £1 million to £2 million |
5% |
|
Over £2 million |
7% |
|
Over £2 Million (purchased by certain persons |
15% |
Q. How much will it cost to sell my property?
A. Costs associated with selling your property can vary and consist of the following:
Estate agent commission fee - this is payable to your estate agent upon completion of the sale of your property, once contacts have been signed. The cost will be a percentage of the sale price + VAT
Legal fees - solicitors have varying prices for the conveyancing process
EPC (Energy Performance Certificate) - You are legally required to commission an EPC before the marketing of your property can proceed. Townends can arrange an EPC on your behalf at a cost of £75 + VAT
Q. Are there any additional marketing costs?
A. Our standard marketing package is based on a no sale, no fee agreement. Our staff in branch are able to give you full details of costs for any additional marketing packages, such as Townends Select, available.
Q. What is a lease?
A. A lease simply means the right to occupy a property for a period, which is generally set at 99 or 125 years and allows activity on the property to be controlled through the use of covenants. The lease can be regarded as a set of rules that are designed to enforce important areas of co-operation such as the need for a communal insurance policy or the interval set for external decoration or repair.
Q. How do I extend a lease?
A. There are two ways in which to extend the lease on your property, informal and formal.
- Informal - You may approach the landlord (freeholder) to ask to extend the lease and enter into negotiations on terms such as the length of the new lease, and the amount of ground rent payable. The landlord will ask for an amount of money for this extension and has two months to respond with their "counter notice" if they don't accept your offer.
-
Formal - If the landlord if absent or does not respond positively to your request to extend, you can request permission from the court to extend the lease through a Leasehold Valuation Tribunal. You should do this within 6 months of the deadline you originally gave the landlord. You have a legal right to extend the lease by 90 years if you have owned the property for more than two years. There are certain exceptions to this right.
For more information on the likely cost of extending a lease, please contact Tyser Greenwood Surveyors on 0845 026 5987.
Q. What is an EPC?
A. An EPC (Energy Performance Certificate) gives information on the energy efficiency of your home and provide suggestions on how to make your home more energy efficient and reduce carbon dioxide emissions.
Q. Do I need an EPC?
A. All homes bought and sold or rented require and EPC. You will need to acquire an EPC for your property and provide it to your agent to enable marketing to commence on your property. Once purchased an EPC is valid for 10 years.
Q. Is gazumping legal?
A. Yes it is. An estate agent has a legal duty to put forward all offers they receive to the seller, irrespective of when they are received. It is purely the decision of the vendor whether they wish to accept a higher offer.
Frequently asked questions about buying or selling a home
