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Hello and thank you for your question. My name is ***** ***** I will be very pleased to assist you. I'm a practising lawyer in England with over 15 years’ experience. Please be aware that although I will endeavour to reply to you promptly, I am also in full time private practice and so I may not be available to respond immediately and it may also take me a few minutes to prepare a reply. The site will notify you as soon as I respond. I look forward to working with you to answer your question fully.
Do you have some specific questions regarding a lease? If so I would be delighted to assist
I'm following up on the above. Without some further information from you as above, I am limited in what I can say on the matter but in the hope it is helpful nonetheless, I will provide you with the following broad answer. If you are able to kindly provide me with the above further information or if you have any further questions generally, I will be delighted to expand on the following - please just reply back to me in this case:
Notwithstanding the above, in general terms from what you say, the clause you quote from sets the ground rent that will be paid annually for the lease. It states that it shall be 0.1% of the price that was originally paid by the original lease holder ( this may be you but may not be - it will be the first person that took the lease which would often be from when the property was built or converted into a flat). In our case, the price paid or premium as it is sometimes referred to will be stated in the lease usually in the initial few pages. So for example, if the original price for the property was hundred and £150,000 the annual ground rent would be £150.
It further goes on to say that the ground rent will increase in accordance with the provisions of clause 8 which I have not seen but would usually provide for some form of increase either in accordance with an index like RPI or set increases at intervals.
I hope the above is of some assistance but if you have any further questions, please revert to me
Would you be able to post the exact clause or lease if you have it using the paperclip icon?
Thank you. This appears that the rent of 0.1% of premium is payable twice a year - i.e. from what you say £620/year.
did your solicitor point out the amount of rent payable? my concern in particular, is that if it breaches the £1000/year limit (in London) and £250/year limit (elsewhere) it will not longer be a low rent lease but rather technically it becomes an assured shorthold tenancy if you occupy it as your main residence (albeit with a very long term) which means certain rights for the way, in particular the right of first refusal if the landlord sells the freehold, and that the landlord can serve a s8 notice on non payment of rent for more than 8 weeks and you can lose the lease.
This is turn may mean that certain lenders will refuse to lend on the property. depending depending upon the advice you received when you bought the property, it seems to me, some questions may need to be raised with your solicitor.
if you have clear documentation showing that the rent is 0.1% per year then retain this as it seems to me you could if necessary apply for a declaration from court under the contra preferentum rule for an interpretation of the lease in line with the marketing information if all else failed. The Contra Preferentum rule provides that in the event of any doubt in relation to the construction of an agreement, it will be interpreted in favour of the individual who did not prepare the agreement. May I clarify, is this a property you have not yet bought?
Developers generally take this position because the lease is supposed to be in substantively identical form for all tenants but there appears to be poor drafting in the rent provision as it fails to make clear that it is an annual payment payable in two equal instalments (if that is the intention). At the very very least an enquiry should be raised asking for confirmation that the rent is annual not twice yearly but even this is not ideal. In terms of reports, there is an option to involve the Consumer Code for New Houses in terms of a complaints resolution process.
I concur that it should be made clear and adding I think around three words to ensure it is clear it is an annual amount payable in two instalments would not mean the lease is in substantively different form to others providing they do intend to charge an annual payment and it is not an attempt at sharp practice.
Two reasons - one it is a requirement of almost every lender and so where it is not the case it may be difficult to secure a mortgage on a flat. The second reason is that the point of leases is to create an interconnected set of rights and obligations between tenants in the building and if the lease is not in substantially the same form, it can become very difficult to ascertain which tenants have rights as against each other and the landlord if leases contained varying rights and obligations.
There are continuing efforts to replace leasehold tenure with a more modern and arguably much better and flexible form of ownership called Commonhold. Commonhold was introduced as a legal form of tenure years ago but has struggled to gain any traction. There is now renewed efforts to make this a reality in part due to actions such as this landlord to impose high rents.
typically developers take the view that they will not amend substantively the conditions of sale though there is generally less rigidity in relation to the contract than the lease. In relation to the provision with regards ***** ***** rent, if the lease will not be amended, at a bare minimum, your solicitor should consider raising an enquiry seeking confirmation that the provision in relation to ground rent is an annual payment split into two monthly instalments and that response from the developer should be kept safely by you with the deeds and property records you retain as it would be helpful in relation to any future sale and in the hopefully unlikely event of any dispute is between you and the developer in the future
In the first instance you can ask for an explanation and if not satisfied escalate to their supervisor. if you remain unsatisfied, you can escalate to a formal complaint process and the legal ombudsman. It is possible, I do not suggest this is the case, that there is a reason why enquiries have not been passed on as not all enquiries are appropriate - though these would typically relate to enquiries as regards ***** ***** of the property as opposed to the legal title.
You can ask but the answer will likely be no. It is typically the solicitors main element of profit as they usually agree a low fixed fee to get the business from the developer.
I'm pleased I could continue to assist.
Great news - well played. I am not allowed to accept client referrals unfortunately under the terms of service but if you would like to confirm your email address I am happy to drop you a line
Many thanks - I have dropped you a line