Lease extension advise, please

red

Hi all!
I am completely stuck and have been for a few years now....I bought a leasehold flat about 3 years ago. When I purchased it, I asked the landlord if it would be possible to get their approval for 1. developing the flat and 2. extending the lease. The landlord was very accommodating and indicated both points would be fine. So, the development went ahead and we then tried to extend the lease. I have tried every route possible, both informally and through solicitors to try to get a more structured approach...however, I have avoided serving notice. Now, as there is still no movement and the flat is losing value and the cost of extending the lease is increasing, I am feeling that I have to go down the route...

Has anyone got any advice and/or help, particularly with regards to contacts who may be able to assist in this area?

Entertainer

Try asking here:

http://www.landlordzone.co.uk/forums/forumdisplay.php?f=11

Long Leasehold Questions. They should be able to advise you about how to serve notice.

Fire_Fox

Why have you avoided serving notice?

red

Fire_Fox wrote: »

Why have you avoided serving notice?

at the moment, the lease is very old and makes matters such as insurance, repairs and maintenance divided along property lines as opposed to a shared cost between freeholder and leaseholder. i was trying to keep things informal and hoping that costs would be kept down and we would update the lease. however, as the landlord's side has offered to extend the lease for nearly a year (before this i was in direct informal dicsussions with the landlord for nearly 3 years) without any action and their estimated legal costs are so high (starting at £3k) i feel i no longer have a choice but to serve notice...but the situation is somewhat complicated as the property has since been divided and the valuation needs to tkae into account the existing arrangment but as if it were the original layout.

Fire_Fox

I don't think I understand your post ... insurance repairs and maintenance are normally the responsibility of the freeholder to organise, but the leaseholders to pay for. In your OP you say you have tried every route possible, but have not served notice which is the correct way to proceed??

Service charges and administration charges must be "reasonable" and "reasonably incurred" so I can't see why this would not also apply to the legal costs attached to lease extension, as you have a legal right to extend your lease. Have you read the LEASE website that we always link to?

red

sorry for not making it more clear - i wrote out a whole reply and then my computer crashed so if this appears twice, apologies...

About 4 years ago, my sister bought a flat as an investment. As she was not working in the UK, I carried out a lot of the research on her behalf. Two things came out of the research - the first was the lease which was quickly reaching the 80 year-mark and the possibility to let the property out if my sister would not return to the UK for sometime.

Before she bought, I asked the landlord about the opportunity to extend the lease and they suggested this would not be a problem...therefore, my sister proceeded. She knows very little about leases etc, and I am equally lacking in experience so we just assumed this was fine. A few months after buying the place we realised there was scope to convert the flat into two flats so we went through the process of requesting permission from the landlord, planning permission etc etc.

When the conversion was complete my sister realised that her job was not going to bring her back to the UK and so I bought the place from her. She was not eligible to serve notice but at the time we knew nothing about notice periods or that we even had any rights as lease holders. When I bought the place from her, I again approached the landlord informally - now about a year since we had first talked about it at length.

The landlord indicated they were happy to extend the lease. Everything looked fine...and then the landlord heard that they could expect a vast amount of money in premiums for the lease extension. I asked how much this was and they went round in circles for months never actually proceeding with anything.

So, I gained legal advice and was told it would be best to wait until my eligibility kicked in. However, as my eligibility will only cover extending the existing lease, (not create two new leases for the two flats) it is not the tidiest solution. I have been given advice that I will be able to create underleases so it will still solve the problem, albeit in a slightly complicated manner.

So, I have not served notice as up till now it looked like I did not have the eligibility and the landlord was going to create two new leases...but as they have not acted for a total of 4 years now that makes me think I have to extend the lease as opposed to creating 2 new ones.

The insurance, repairs etc are not set up as usual in the lease which is why I want to update it and make it a shared concern.

Fire_Fox

Sounds to me more like you need to create new leases more than you need to extend the messy existing arrangement. Presumably you could only create underleases for the remaining period of the lease which might not be enough to be easily mortgageable. As I asked have you read the LEASE website, specifically the sections of extending and varying the lease? When you bought the flat why wasn't the issue of repairs and insurance raised by your conveyancing solicitor? Who is currently paying for repairs and insurance?

red

I can create 2 underleases which would cover the full term of the lease plus the extension of the lease, if/when it were complete.

I have read and spoken with the lease advisory service...I am aware that I have no legal right to demand 2 new leases...only to extend the existing one.

I do not know why the conveyancing solicitor did not mention the way the lease sets up the repairs etc. I think the fact that were no major repairs due perhaps meant that it was not a focus. I insure my part of the flat and the landlord their part below. It is not impossible to make it work as is, but it is just complicated the way it stands.

Fire_Fox

I didn't realise the freeholder also owned the other flat in the property, in which case yes you would share repairs and insurance. If you have already spoken to LEASE it sounds to me like you need to pay for legal advice, both to establish whether your conveyancing solicitor missed a trick with the insurance/ repairs arrangements and to organise serving notice on extending the lease, which it seems you will need to do. Not really sure what else you are hoping for?