I am intending to sublet my leasehold flat in Shoreditch. Conveyancing solicitor who did the purchase is retired - so can't ask him. Is permission from the freeholder required?

Your lease dictates the relationship between the freeholder and you the leaseholder; in particular, it will set out if subletting is not allowed, or permitted but only subject to certain conditions. The accepted inference is that if the lease contains no expres ban or restriction, subletting is allowed. The majority of leases in Shoreditch do not prevent subletting altogether – such a clause would adversely affect the market value the flat. Instead, there is usually a basic requirement that the owner notifies the freeholder, possibly supplying a copy of the tenancy agreement.

I own a leasehold flat in Shoreditch. Conveyancing and Platform Home Loans Ltd mortgage organised. I have received a letter from someone claiming to own the freehold. Attached was a demand for arrears of ground rent dating back to 1997. The conveyancing solicitor in Shoreditch who acted for me is not around.Do I pay?

First contact HMLR to be sure that the individual claiming to own the freehold is in fact the registered owner of the freehold reversion. You do not need to instruct a Shoreditch conveyancing firm to do this as you can do this on the Land Registry website for £3. You should note that regardless, even if this is the legitimate landlord, under the Limitation Act 1980 no more than 6 years of rent can be collected.

Last month I purchased a leasehold flat in Shoreditch. Am I liable to pay service charges relating to a period prior to completion of my purchase?

Where the service charge has already been demanded from the previous lessee and they have not paid you would not usually be personally liable for the arrears. Strange as it may seem, your landlord may still be able to take action to forfeit the lease. A critical element of leasehold conveyancing for your conveyancer to be sure to have an up to date clear service charge receipt before completion of your purchase. If you have a mortgage this is likely to be a requirement of your lender.

If you purchase part way through an accounting year you may be liable for charges not yet demanded even if they relate to a period prior to your purchase. In such circumstances your conveyancer would normally arrange for the seller to set aside some money to cover their part of the period (usually called a service charge retention).

I am employed by a busy estate agency in Shoreditch where we have witnessed a number of leasehold sales put at risk as a result of leases having less than 80 years remaining. I have been given contradictory information from local Shoreditch conveyancing firms. Please can you clarify whether the owner of a flat can initiate the lease extension process for the purchaser on completion of the sale?

Provided that the seller has been the owner for at least 2 years it is possible, to serve a Section 42 notice to commence the lease extension process and assign the benefit of the notice to the purchaser. This means that the buyer need not have to wait 2 years for a lease extension. Both sets of lawyers will agree to form of assignment. The assignment has to be done before, or simultaneously with completion of the sale.

Alternatively, it may be possible to extend the lease informally by agreement with the landlord either before or after the sale. If you are informally negotiating there are no rules and so you cannot insist on the landlord agreeing to grant an extension or transferring the benefit of an agreement to the purchaser.

We have reached the end of our tether in trying to reach an agreement for a lease extension in Shoreditch. Can this matter be resolved via the Leasehold Valuation Tribunal?

in cases where there is a absentee landlord or if there is disagreement about what the lease extension should cost, under the Leasehold Reform, Housing and Urban Development Act 1993 you can apply to the First-tier Tribunal (Property Chamber) to assess the price payable.

An example of a Lease Extension case for a Shoreditch property is 137 & 139 Haberdasher Street in December 2013. The Tribunal determines in accordance with section 48 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 that the premium for the extended lease for each Property should be £12,350.00. This case affected 2 flats. The unexpired term was 72.39 years.

What are the frequently found problems that you see in leases for Shoreditch properties?

Leasehold conveyancing in Shoreditch is not unique. Most leases is drafted differently and drafting errors can result in certain provisions are missing. For example, if your lease is missing any of the following, it could be defective:

• A provision to repair to or maintain elements of the building
• A duty to insure the building
• Clauses dealing with recovering service charges for expenditure on the building or common parts.
• Maintenance charge proportions which don’t add up to the correct percentage

A defective lease can cause issues when trying to sell a property primarily because it impacts on the ability to obtain a mortgage on the property. Lloyds TSB Bank, Coventry Building Society, and Bank of Ireland all have very detailed requirements when it comes to what is expected in a lease. Where a lender has been advised by their lawyers that the lease does not cover certain provisions they may refuse to grant the mortgage, forcing the purchaser to pull out.

Other Topics

Lease Extensions in Shoreditch