Please help ground rent issue

Andytree

Having saved up for many years, I recently purchased a maisonette in Surrey. The property was advertised with a long lease.

Having read about the various leasehold and ground rent scandals, I was careful and repeatedly asked for information about the amount of ground rent and the basis for any increase.

I was provided a copy of the lease (attached below) and a letter from the landlord stating that the lease was £50 per year. The lease showed that this increased by a nominal £50, every 33 years. The purchase completed on this basis on 5 October 2018.

In June I received an unwelcome letter form the landlord asking for a ground rent of £150. I queried the amount, thinking it to be incorrect.

The landlord said that two weeks before completion (on 26 September 2018) the homeowner had agreed to a lease extension with the new terms for ground rent. These are £150 immediately with the amount doubling every 25 years.

I was not told about this and am utterly staggered. When I last queried the matter on 1 October, four days before completion I was referred back to the letter with the £50 in ground rent.

Please could you help by advising what my rights are here, how I can challenge this and what I can do to rectify matters.

The landlord said the following;

the rent in the original lease was £50, however a lease extension was agreed with the previous owner of the property which was completed on the 25th September 2018.
As the completion of your purchase did not take place until the 5th October 2018, your solicitors should have been made aware of the lease extension and the terms within it, which should subsequently have been disclosed to you.
The ground rent in the new lease is £150, doubling on the 24th June 2042 and every 25 years thereafter.

anselld

You need to speak to your Solicitor to find out ...
(a) if what is being said is correct
(b) why you were not advised.

rachel230

You say it had a long lease but then it was extended again just before you bought it? What was the length of the lease that you signed up for? How many years was the last minute extended lease for and have you benefited from a longer lease than you originally thought you were buying?

mrschaucer

What date did you exchange contracts on the property?

eddddy

It sounds very much like the lease was extended specifically for your purchase. Weren't you aware of this?

Your solicitor must have been aware of this, and should have made you aware of the terms of the extended lease.

(Unless the landlord has made a mistake - for example, they are confusing your lease with somebody else's.)

If none of your correspondence from your solicitor refers to a lease extension (and/or new terms in the lease), it's probably worth asking your solicitor why not.

Andytree

Thank you for your answers.

The house was advertised as a ‘long lease’.

However, the lease was 99 years starting in March 1997. So while I was going through the transaction the vendor was extending then lease. I only realised the lease had not been extended by my solicitor. I made clear that the I would not progress without the longer lease.

I did not know and was not made aware (and possibly neither was my solicitor) that as part of the extension the new ground rent arrangements were agreed.

The agreement between the vendor and the landlord happened at the end of September. The property completed on 5 October after I was made aware that the lease extension was agreed.

The document sent showed the lease extension but nothing about the agreement on ground rent.

Had I known this, I would not have completed.

Andytree

Also, just to add.

I wanted the lease extension but did not want it to come with ground rent which doubles. I was not told about this and would not have agreed to the purchase had I known.

The vendor obviously cut their costs by agreeing to the increase in ground rent, knowing it would fall on the purchaser.

I’m fairly sure my solicitor was also not told about this.

D_M_E

When did you exchange contracts - NOT complete - and were you made aware of the new lease terms before exchange?

From what you have written it would appear the seller was in the process of arranging the extension and got it done after you had exchanged.

Since exchange had taken place before the lease had been extended then it's likely someone made an error by not informing you of what the new lease terms would be/have been - who made the error would be key here.

rachel230

Was the lease extension shown as a variation of the original lease? The variation will show the terms varied e.g. longer lease and any changes in ground rent terms. Should have been registered at the land registry so you can ask them for the official copy of the variation. See what is actually states. If this has indeed been sneaked in your solicitor should have spotted this. It is his job to carefully check the lease and advise you.

rachel230

If done after exchange then the vendor surely wouldn't be able to change the terms of what had been agreed in the contract.

eddddy

Andytree wrote: »

I’m fairly sure my solicitor was also not told about this.

That doesn't sound credible.

Your solicitor must have seen the deed of variation.

No solicitor would proceed with the purchase of a lease, without a copy of the lease and any deed of variation.


(As a starting point, your solicitor wouldn't even know whether the the lease had been extended, without seeing the deed of variation.)