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  • FIRST POST
    • Andytree
    • By Andytree 12th Jun 19, 5:21 PM
    • 10Posts
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    Andytree
    Please help ground rent issue
    • #1
    • 12th Jun 19, 5:21 PM
    Please help ground rent issue 12th Jun 19 at 5:21 PM
    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;

    [I][I]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.
Page 2
    • snilloct1957
    • By snilloct1957 13th Jun 19, 8:12 AM
    • 208 Posts
    • 214 Thanks
    snilloct1957
    Shouldn't the seller's solicitor have notified the buyer's solicitor about the change in ground rent? Maybe he was negligent? Just saying...
    • Tom99
    • By Tom99 13th Jun 19, 8:22 AM
    • 4,918 Posts
    • 3,452 Thanks
    Tom99
    Shouldn't the seller's solicitor have notified the buyer's solicitor about the change in ground rent? Maybe he was negligent? Just saying...
    Originally posted by snilloct1957
    The OP's solicitor should not have exchanges contracts without seeing the completed deed of variation.
    What date were contracts exchanged?
    • Andytree
    • By Andytree 13th Jun 19, 8:34 AM
    • 10 Posts
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    Andytree
    * or send it to me
    • Andytree
    • By Andytree 13th Jun 19, 8:53 AM
    • 10 Posts
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    Andytree
    Deed of variation - 26 September

    Contracts were exchanged - 3 October

    I donít believe the solicitor ever checked or saw the deed of variation and consequently, it was never sent to me.
    • deannatrois
    • By deannatrois 13th Jun 19, 9:15 AM
    • 6,313 Posts
    • 8,890 Thanks
    deannatrois
    Bear in mind though, that the costs of such a claim could easily outweigh the extra cost you weren't expecting. It isn't right that this has happened but the benefit is you have a longer lease. As you say, £100 extra a year is not a great deal, nor is £250 after 25 years. Its just not what you were expecting. If it was doubling every ten years, you might have a resale problem but not at the level your ground rent is at doubling every 25 years.

    Unfortunately you can't go back and renegotiate. I would assume the previous owner didn't really care what level the ground rent was set at because he wouldn't be paying it. He just wanted to reduce his costs for the new lease (up front money).
    • Tom99
    • By Tom99 13th Jun 19, 9:45 AM
    • 4,918 Posts
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    Tom99
    Deed of variation - 26 September
    Contracts were exchanged - 3 October
    I don’t believe the solicitor ever checked or saw the deed of variation and consequently, it was never sent to me.
    Originally posted by Andytree
    They should have seen and checked it, how else can they hope to advise you, the rent could have been £500.
    Last edited by Tom99; 13-06-2019 at 9:49 AM.
    • Fire Fox
    • By Fire Fox 14th Jun 19, 2:45 AM
    • 25,155 Posts
    • 29,398 Thanks
    Fire Fox
    Thank you for your answers.

    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.

    Had I known this, I would not have completed.
    Originally posted by 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.

    Iím fairly sure my solicitor was also not told about this.
    Originally posted by Andytree
    I was not aware that the ground rent had been changed as part of the transaction to extend the lease before I completed.

    Iíve checked every single email and nothing about this was mentioned.

    Two days before exchange my solicitor said the ground rent was the £50 from the original lease. I can only assume the solicitor had not seen any variation as well at the time of completion.
    Originally posted by Andytree

    Thanks Tom.

    So I guess given that my solicitor did not check the deed of variation or someone it to me, my only option is down the negligence route?
    Originally posted by Andytree
    Deed of variation - 26 September

    Contracts were exchanged - 3 October

    I donít believe the solicitor ever checked or saw the deed of variation and consequently, it was never sent to me.
    Originally posted by Andytree
    Welcome to MSE.

    Too many ifs, buts and maybes.

    Nobody can advise you what to do next until you know definitively where you are now. Formally query this (not a complaint as yet) with your solicitor.
    Declutterbug-in-progress.⭐️⭐️⭐️ ⭐️⭐️
    • BMilo1
    • By BMilo1 16th Jul 19, 12:36 PM
    • 9 Posts
    • 1 Thanks
    BMilo1
    Wow, this sounds very similar to what I've been going through recently!
    I was aware of our lease being extended but not made aware of the effect of the new terms being added in. I wonder if your freeholder/solicitor is the same one as me as our property is in Sussex. We purchased 4 years ago and was made aware 2 years ago that our property is unsellable (unmortgageable) due to the ground rent terms - £175 per year doubling every 15 years, the length of the lease is 148 years. Have lost 2 buyers and a lot of money! We are going down the professional negligence route and have been given a good chance of claiming back our losses. We are just entering into a Statutory Lease Extension where the costs will be around £20,000 so that we are able to move.
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