Asking Estate Agents About Leasehold Terms

marshall_mcf

We are in the process of putting our first house on the market and so we are trying to arrange viewings for properties we are interested in to purchase.  We bought our first house as a new build off-plan, so we’ve not had much exposure to estate agents in the past.

I saw a property I liked the look of on Rightmove, but it’s listed as leasehold.  I gather that some leaseholds are better than others (999 year term vs. 75 years, for example), so I’m not entirely put off a leasehold property if the property itself ticks lots of our boxes.

I asked the estate agent selling the property some questions related to the length of the leasehold, whether charges were fixed etc., but they were unable to disclose anything as apparently ‘it will all be found out in the legal process’… This took me by surprise, as I had presumed these were the sorts of things prospective buyers would ask at the first opportunity before wasting the estate agent’s time in arranging a viewing with us, let alone before incurring legal costs if we were to make an offer?

Is this standard practice, or have I just had an unlucky encounter with an unhelpful estate agent?

Thanks

GDB2222

They don't always know, so I am afraid that you were being fobbed off. Lease term is a perfectly reasonable question, by the way. 

kingstreet

Until the vendor appoints a solicitor who obtains these documents the agent is unlikely to have been told the fine detail unless the vendor just happened to know and until the EA has it in writing they will be unwilling to provide potentially unreliable data.

eddddy

marshall_mcf said:

I asked the estate agent selling the property some questions related to the length of the leasehold, whether charges were fixed etc., but they were unable to disclose anything as apparently ‘it will all be found out in the legal process’… This took me by surprise, as I had presumed these were the sorts of things prospective buyers would ask at the first opportunity before wasting the estate agent’s time in arranging a viewing with us, let alone before incurring legal costs if we were to make an offer?

You're right to be surprised.

Most estate agents are members of the Property Ombudsman Scheme. The Ombudsman's mandatory code of practice for estate agents says they must provide this type of info:

7k

In regard to leasehold properties, in accordance with paragraph 4e, you must provide material information to the consumer so they can make an informed transactional decision. Material information in respect of the lease includes, but is not limited to, the following:

• Number of years remaining on the lease;

• Amount of ground rent (*) and when payable, together with details of how this will increase over time, if applicable;

• Rent payable in the case of a shared ownership arrangement;

For leasehold, commonhold and freehold properties where the owner has a legal obligation to contribute towards the maintenance costs of a shared amenity, material information would include, but is not limited to the following:

• Amount of service charge (*), and when payable;

• Amount of any event fees (*), and when payable;

• Amount of reserve fund (*) contribution and when payable (if not already included in other charges);

Link: https://www.tpos.co.uk/images/Codes_2019_a5/TPOE27-8_Code_of_Practice_for_Residential_Estate_Agents_A5_-_Effective_1_June_2019.pdf

Tiglet2

eddddy said:

marshall_mcf said:

I asked the estate agent selling the property some questions related to the length of the leasehold, whether charges were fixed etc., but they were unable to disclose anything as apparently ‘it will all be found out in the legal process’… This took me by surprise, as I had presumed these were the sorts of things prospective buyers would ask at the first opportunity before wasting the estate agent’s time in arranging a viewing with us, let alone before incurring legal costs if we were to make an offer?

You're right to be surprised.

Most estate agents are members of the Property Ombudsman Scheme. The Ombudsman's mandatory code of practice for estate agents says they must provide this type of info:

7k

In regard to leasehold properties, in accordance with paragraph 4e, you must provide material information to the consumer so they can make an informed transactional decision. Material information in respect of the lease includes, but is not limited to, the following:

• Number of years remaining on the lease;

• Amount of ground rent (*) and when payable, together with details of how this will increase over time, if applicable;

• Rent payable in the case of a shared ownership arrangement;

For leasehold, commonhold and freehold properties where the owner has a legal obligation to contribute towards the maintenance costs of a shared amenity, material information would include, but is not limited to the following:

• Amount of service charge (*), and when payable;

• Amount of any event fees (*), and when payable;

• Amount of reserve fund (*) contribution and when payable (if not already included in other charges);

Link: https://www.tpos.co.uk/images/Codes_2019_a5/TPOE27-8_Code_of_Practice_for_Residential_Estate_Agents_A5_-_Effective_1_June_2019.pdf

I have read the Estate Agents Code of Practice and understand that they should be providing the above information.

Why is it then that the vast majority of Estate Agents do not provide this information, nor do they seek to ask for sight of the lease from the vendor or Land Registry?  

eddddy

Tiglet2 said:

I have read the Estate Agents Code of Practice and understand that they should be providing the above information.

Why is it then that the vast majority of Estate Agents do not provide this information, nor do they seek to ask for sight of the lease from the vendor or Land Registry?  

I don't know - I guess they're just lazy, or they haven't kept up with the rules.


In fact, both the Property Ombudsman and NAEA (National Association of Estate Agents) suggest that agents are breaking consumer protection law, if they don't provide this type of info. - The Consumer Protection from Unfair Trading Regulations 2008.


NAEA Propertymark even provide a "Property Information Questionnaire" (PIQ) which they recommend Estate Agents ask their sellers to fill-in with all these types of info. It's 16 pages long and very similar to the TA forms.

Consumer Protection from Unfair Trading Regulations 2008

We strongly encourage our members to use the PIQ and work with vendors as omissions and inaccuracies often lead to delays in transactions. It will help you to disclose any issues that would affect the transactional decision of the average consumer.

Link: https://www.propertymark.co.uk/resource/property-information-questionnaire-sales.html

bouicca21

I’d ask the vendor for sight of the lease.

steve866

How frustrating. When I was looking to buy a flat the first question I would ask is the length of lease and service charge. Lazy agent. 

NameUnavailable

The EA should ask the vendor, the vendor should know this stuff.

You can also download the title info from the Land Registry for £3 which will tell you - and then you can also get a copy of the lease for £7 but you have to get that sent to you.

It should be a legal requirement IMHO for leasehold properties to be advertised with basic info (lease length, ground rent, any set maintenance charge).

marshall_mcf

Many thanks for all these useful responses.  Seems like I came across a bit of a shoddy agent… needless to say I won’t be progressing things with them!

Many thanks.