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Leasehold To Freehold Changes

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We would welcome any advice. We recently received a letter explaining that a company called "Fee Simple Estates" had purchased the Freehold Interest in our property.

 

We bought the property in 2002 with a leasehold tenure. The leasehold term is 800 years from 1935. The ground landlord was advised by the solicitor at the time and since then we've been paying a nominal ground rent to the ground landlord, Norrow Estates. That's continued for the last 19 years until earlier this month we received the letter from Fee Simple Estates. The letter includes a rent demand notice for arrears of £0. It also states it sets out the amount of rent due and by when, but doesn't, it simply includes a long list of T&Cs.

 

They have attached a copy of a solicitor's letter referencing ours and numerous other properties in the area. It advises that "Christopher Gordon Stanley Bone" sold his freehold interests in the properties earlier this year and that rent will now be due to Fee Simple Estates.

To me, this sounds like the freehold was sold and then sold again in a short space of time (?).

 

  • I was under the impression that should the freehold be sold, then we as owners, would have first refusal?
  • What are the likely implications of a new landlord, can they raise the ground rent significantly?
  • Their T&Cs advise that any alterations to the house first need their approval and has to go through an approval process or be in breach of the lease. We have to submit details of the alterations in writing and they will then advise of the approval process. I presume that will involve a cost?
  • I have viewed other threads and wonder if there's value in looking to purchase the freehold. What are people's thoughts given the long lease period and nominal ground rent (at least for now)?

 

Thanks

 

 

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Check your lease details. They will provide the details of your payment i.e fixed or subject to change. If it is fixed then then it cannot be raised.

The alterations to the house is probably correct, my lease included that (but then again it also included that i should paint the front every two years too) but again check your lease to see if that covers only external alterations.

 

You don't have first refusal if the lease holders chooses to sell, however you can enquire about the cost of buying the freehold. Depending on your yearly fee this could be expensive but you have to weigh it up against what you plan to do with the property in the long term. 

 

If you are paying a peppercorn fee then it would be worth enquiring.  If the leaseholder thinks it can make a profit then it will probably make you an offer. I've gone through this with mine so if you want to chat drop me a pm

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22 hours ago, chipfork said:

We would welcome any advice. We recently received a letter explaining that a company called "Fee Simple Estates" had purchased the Freehold Interest in our property.

 

We bought the property in 2002 with a leasehold tenure. The leasehold term is 800 years from 1935. The ground landlord was advised by the solicitor at the time and since then we've been paying a nominal ground rent to the ground landlord, Norrow Estates[1]. That's continued for the last 19 years until earlier this month we received the letter from Fee Simple Estates. The letter includes a rent demand notice for arrears of £0. It also states it sets out the amount of rent due and by when, but doesn't, it simply includes a long list of T&Cs.

 

They have attached a copy of a solicitor's letter referencing ours and numerous other properties in the area. It advises that "Christopher Gordon Stanley Bone" sold his freehold interests in the properties earlier this year and that rent will now be due to Fee Simple Estates.

To me, this sounds like the freehold was sold and then sold again in a short space of time (?)[1].

 

  • I was under the impression that should the freehold be sold, then we as owners, would have first refusal?[2]
  • What are the likely implications of a new landlord, can they raise the ground rent significantly?[3]
  • Their T&Cs advise that any alterations to the house first need their approval and has to go through an approval process or be in breach of the lease. We have to submit details of the alterations in writing and they will then advise of the approval process. I presume that will involve a cost?[4]
  • I have viewed other threads and wonder if there's value in looking to purchase the freehold. What are people's thoughts given the long lease period and nominal ground rent (at least for now)?[5]

 

Thanks

 

 

Replies, keyed to the bracketed numbers that I've inserted:

 

1. No. Perhaps Norrow was collecting rent on his behalf. I do not think that Norrow itself owns any freehold reversion portfolios.

2. No. RFR applies only to blocks of flats, not to houses.

3.  No. The lease is wholly unchanged. Just as you probably weren't the original leaseholder/tenant, FSE isn't the original freeholder/landlord.

4. Yes, but only for its admin. costs- not as a 'profit' lump sum. Refusal of consent for improvements is constrained by s.19(2) of the Landlord and Tenant Act 1927- yes, really: see https://www.legislation.gov.uk/ukpga/Geo5/17-18/36/section/19

5. That depends on what FSE wants by way of sale price (> 30 x ground rent would be a bit expensive) and its fees.

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Many thanks for the clarification and advice.

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If you can afford then always buy the freehold reversion.

 

If anything it makes things simpler if/when you come to sell, but it also gets that monkey off your back for any alterations you might want to make in the future.

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On 24/05/2021 at 10:50, sheffbag said:

 If the leaseholder thinks it can make a profit then it will probably make you an offer.

OP is the leaseholder, though.

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