First time buyer council property

matt8282

Hello I am currently in the process of buying my first property from an estate agency. I have stumbled across an issue which may result in the purchase being terminated. My plan is to purchass a two bed property with the view to lodge/rent out the spare room to a friend so the mortgage is paid off quicker. The plan is for the rent/lodger payments to cover the cost of the monthly mortgage payment and then every year I am to pay off 10% the remaining mortgage balance. I have obviously worked it out so I am able to survive without the spare room used.

However this week I recieved the papers through to sign the contract and received the leaseholders information. One of the clauses in the leaseholders paper work states "1.1 Not to use the flat nor permit the same to be useď for any purpose other than as a private dwelling in the occupation of one family only."
To me this sounds like I am unable to do what I intend to do. I have emailed by solicitors with my concerns of the phrase. Its annoying as when viewing the property I told the Estate Agents what my intentions were to do with the property.
I could understand if I were to sublet out both rooms to strangers. But my intentions are to live in the property and allow 1 room to be used, where the person would have access to the whole property, therefore it would be like living as "one family" as otherwise the spare room would remain vacant and a waste.


Has anyone stumbled upon this clause and what are your views?

NeilCr

Pretty standard in flats as far as I know

I suspect the EA might not have known about it (decided not to mention it)

In the end you take a chance on whether or not others in the block notice it and inform the freeholder if you decide to proceed with your plan

Do you know whether or not the residents own the freehold or if there is an external freeholder?

ETA

Not sure where the council comes into this?

matt8282

The freeholder is owned by the city Council. From looking at the information on the flat, about 9 of the properties are owned by leaseholders.

I just find this clause very restrictive and the statement is written for it own interpretation. Im in an fortunate position where I could drop out of the purchase, however I dont feel its fair on the seller. But given the fact the Estate agent wasnt completely honest with me the guilt of dropping out of the sale is eroded. I dont wish to do this but I am not happy to live with restricted clauses which would soon catch up with me.

matt8282

The council is Southampton City Couuncil

davidmcn

matt8282 wrote: »

the Estate agent wasnt completely honest with me

In what way? Estate agents don't read leases. It's a job for your solicitor.

Councils have barely enough resources to do the bare minimum they have to; they're not going to be going around actively enforcing these sorts of clauses. It's possible other leaseholders are entitled to do so, but again, why would they go to the trouble and expense of doing so unless you (and/or your lodger) were causing serious problems?

matt8282

When I highlighted to the Estate Agency my intentions to rent out the spare room I would have thought they would highlight the potential clause may be in effect based on their expertise in selling properties in the area. If I knew of the clause before starting the process I would have not put an offer in for the property.

Your right its the solicitors job also to confirm the clauses which they have done.

Im worried that I move into a flat and the current residents moan about it and therefore I remove the lodger and end up with a unoccupied room.

My morales of living is if i can accommodate another person to live with me in a spare room so they can eventually get on the property ladder then I will want to use the spare room to do so. But if theres restrictions in place then I wont take up a 2 bed property for 1 person as I feel its a waste too society. Even if the price I got it for is cheaper than a usual 1 bed property.

G_M

In this day an age, where there are now (aparently) 98 cagories of gender, who is to say whether you and your 'lodger' are one 'family' or not?

00ec25

matt8282 wrote: »

When I highlighted to the Estate Agency my intentions to rent out the spare room I would have thought they would highlight the potential clause may be in effect based on their expertise in selling properties in the area. If I knew of the clause before starting the process I would have not put an offer in for the property. .

as a first time buyer it is clear you misunderstand the role of an estate agent

they market a property. They do not need or have to know what is in the lease in order to do so. Such issues are the responsibility of the buyer to ask the right questions of the right people, the fancy phrase for that is "do your due diligence"

you might expect the seller to have knowledge of the terms of their lease, but then again I expect many people would hardly be able to quote from their lease clauses that they may never have bothered with as they had no relevance to them personally whilst owning.

that is why you pay a solicitor to read the lease and advise you on its interpretation once you tell your solicitor what you are concerned with so the solicitor knows to look for issue that may affect that.

you can rant and wail as much as you like about an EA, but it really is not their responsibility to do your due diligence for you

davidmcn

G_M wrote: »

In this day an age, where there are now (aparently) 98 cagories of gender, who is to say whether you and your 'lodger' are one 'family' or not?

Quite. The neighbours will know that the OP and their friend both live in the flat, they're not going to be investigating the sleeping or financial arrangements. The covenant is there to step the flat being turned into something like an HMO which might actually affect the neighbours.

NeilCr

davidmcn wrote: »

Quite. The neighbours will know that the OP and their friend both live in the flat, they're not going to be investigating the sleeping or financial arrangements. The covenant is there to step the flat being turned into something like an HMO which might actually affect the neighbours.

I wouldn't underestimate the ability of some "nosey" neighbours.

I've lived on two estates. In the first - a block of flats in London - hardly anyone knew or saw anyone. I, occasionally, bumped into my neighbour on our way to work but that was it. Even when I became a director I knew little more

Down here a mixed development of houses and flats it is completely different. I am chairman of our ManCo and am amazed at just how much one or two of my fellow directors know about who lives where and with whom. There are quite a number of retired folk who are around a lot which does explain it a bit, I guess. It all passes me by!

I think the OP probably will be fine but there is a risk. If it was me I'd be trying to get a sense of the make up of the block. There may well be a lot of renters there, anyway, for example

worried_jim

I wouldn't worry about it and crack on with your original plan- sounds good.

As long as you don't rent to a nutjob creating issues you'll be fine. I've done it for 13/16 years- only had my property to myself for the last 18 m months.

edit- don't believe a word an estate agent tells you- if their lips are moving they are probably lying.