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Help, please, issue buying a leasehold flat

PragueAddickPragueAddick
in Not Sports Related
I'm not the buyer, somone close to me is, and I don't know the answer, it does seem like somebody trying it on.

Leasehold flat in Belvedere. Nothing odd, as far as is known, about the lease, or the building. To be purchased by parent, son will then live in it. The parent has been told by their own conveyancing solicitor that "sub-lets" are not allowed and it will cost £8,000 for an amendment to the sale contract, to allow it. Parent is perplexed, and so am I. Surely it isn't a sub-let? My understanding is that a sub-let is when a tenant then lets the property to somebody else. This looks like a perfectly normal buy- to- let- within- a family. They seem to be saying that only the parent can live there.  WTF? and more importantly, what to advise? 

Thanks!

Comments

  • JintsJints
    I'm guessing what they mean is that the lease requires that the lessee occupies the property themselves and doesn't part with possession. THe son living there by himself would eitehr be a tenant or a licensee (if not paying any rent). Not my area but I don't think this is a very common provision in a residential lease (certainly not a long lease) but it shoudl be obvoius from the lease itself so they shoudl check the provision. 

    I don't think that the sale contract would need to be amended, it would have to be the lease itself but that would only be possible if the freeholder agreed. It certainly wouldn't cost £8K to make a simple variation to a lease even if though you'd have to pay costs of both freeeholder and your own.   
  • CatfordCatCatfordCat
    disclaimer that i am not a lawyer, but...

    i have seen some leasehold flats advertised on the basis it's a condition of the lease that you can't then rent the place out.

    freeholders can impose conditions on what leaseholders can do.

    don't think it is that common, but not unique.


    https://www.lease-advice.org/ may be worth a look.

    this may be why place was cheaper than similar locally...

  • SamB09SamB09
    Is it shared ownership? I have one in belvedere and it’s leasehold. Pretty sure the t and c’s stated that the buyer has to live there.
  • swords_aliveswords_alive
    Among the best purpose built flats in Belvedere, imo, are on Essenden Road and they cannot be let, I.e. owner occupier only. Certainly doesn't seem to have impacted prices of these flats and has, probably, kept them in better order than others, like a mate of mine's also in Belvedere, where 50% are let out!
  • Off_itOff_it
    It's actually more common then people think. The idea is that the people who buy actually live in the flats and don't just rent them out. 

    Although it's not a "normal" sublet, if one person is buying and letting someone else live there then it will probably fall foul of the covenant in the original lease.

    One alternative would be for the parent to lend the son the money and let him buy it in his own name. But I don't think I would do that personally!
  • paulsturgesspaulsturgess
    Was gonna say, think this is common if not standard / par for the course on shared ownership homes, but very rare on non shared ownership and I would have thought on a non shared it would be an unreasonable lease clause. Was it a shared ownership ever that maybe the owner paid up to 100% for ?
  • AddicksAddictAddicksAddict
    Off_it said:
    It's actually more common then people think. The idea is that the people who buy actually live in the flats and don't just rent them out. 

    Although it's not a "normal" sublet, if one person is buying and letting someone else live there then it will probably fall foul of the covenant in the original lease.

    One alternative would be for the parent to lend the son the money and let him buy it in his own name. But I don't think I would do that personally!
    We did. I suppose it depends on how much you trust your offspring. Ms AA and I have no problem with AA jr. 
  • aliwibblealiwibble
    paulsturgess said:
    Was gonna say, think this is common if not standard / par for the course on shared ownership homes, but very rare on non shared ownership and I would have thought on a non shared it would be an unreasonable lease clause. Was it a shared ownership ever that maybe the owner paid up to 100% for ?
    Yep, this was my thought too, although a couple of my neighbours have staircased out and let out their flats. But I don't know if they had to get the lease specifically amended to be able to sublet when they did so.
  • Off_itOff_it
    AddicksAddict said:
    Off_it said:
    It's actually more common then people think. The idea is that the people who buy actually live in the flats and don't just rent them out. 

    Although it's not a "normal" sublet, if one person is buying and letting someone else live there then it will probably fall foul of the covenant in the original lease.

    One alternative would be for the parent to lend the son the money and let him buy it in his own name. But I don't think I would do that personally!
    We did. I suppose it depends on how much you trust your offspring. Ms AA and I have no problem with AA jr. 
    It's not about trust really though, is it? It's more about how much you want your kids to go out and make their own way in life, rather than being given the money for somewhere to live.
  • HartleypeteHartleypete
    Buy in joint names?
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  • PragueAddickPragueAddick
    Thanks a lot for these answers. I never realised such conditions existed. Having moved away I thought that in the meantime every other Brit had become a buy-to-let landlord….
  • killerandflashkillerandflash
    It's common that you at least have to ask permission before being allowed to sublet. Indeed from a residents and estate point of view, you want subletting tightly controlled

    In this case, maybe the parents should put the flat under the name of the son, seeing that presumably they've bought it for him?
  • PragueAddickPragueAddick
    killerandflash said:
    It's common that you at least have to ask permission before being allowed to sublet. Indeed from a residents and estate point of view, you want subletting tightly controlled

    In this case, maybe the parents should put the flat under the name of the son, seeing that presumably they've bought it for him?
    We have both been thrown by the use of the term “sub-let” whereas we have assumed they would just “let” to their son. And the epidemic of buy-to-let and AirBnB in the UK seems to run against this tight control which I agree has its merits. Oh well, we know now. 

    As to the second point I think they are wary. He is one of the many still living in the parental home when in the past someone of his education and earning level would have moved out by now. 

    But maybe they should do something like that, but set it in stone with some kind of legal contract. 
  • golfaddickgolfaddick
    edited November 2021
    Don't forget that if they buy it in their mane they will have to pay extra stamp duty due to it being a 2nd property. 

    Is there any reason why he cant get a mortgage & buy it himself, with help from them. Probably not any stamp duty as he's a FTB.  
  • PragueAddickPragueAddick
    golfaddick said:
    Don't forget that if they buy it in their mane they will have to pay extra stamp duty due to it being a 2nd property. 

    Is there any reason why he cant get a mortgage & buy it himself, with help from them. Probably not any stamp duty as he's a FTB.  
    I think that is increasingly what they are concluding. They think it's time. And the costs on the property are mounting up with this 8k charge.

    But going back to how they got in this mess, they just showed me the agent's ad for it and there it states "Ideal for Buy-to-Let". So the agent has questions to answer, but so do the solicitors who have only discovered this clause very late in the day.
  • LenGloverLenGlover
    edited November 2021
    Hi, 
    Does seem odd but if the son doesn’t purchase then they will not be “leaseholder” within the lease. leases often restrict letting or parting with possession of PART of the property rather than the whole and property would be described in the lease. For example
    You couldn’t just let out the parking space.

    If they’re willing to entertain a variation for cost, as someone else says it would be the lease that needs to be varied but it does suggest that others may have already varied their leases if allowed.

    They need to check the wording in the lease really!

    Thoughts of my daughter who has a law degree, legal practicising certificate and worked in conveyancing for a while before changing career.

    She reiterates the comments above regarding restrictions of shared ownership leases too.
  • HardyAddickHardyAddick
    A good solicitor will be able to explain and offer advice. A Licenced Conveyancer in my experience may not be experienced enough. You get what you pay for. 
    I take a sub-let to mean a tenant on an AST cannot let the property to another tenant. 
  • Bromley GrahamBromley Graham
    My sister in law lives in a Flat that has a no tenant clause in the Lease. The block is 30% occupied by tenants. It is ,for her, virtually impossible to stop this happening.
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