Do you have a long term assured shorthold tenancy?

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Do you have a long term assured shorthold tenancy?

    This has been floating around for a while, but many people don't seem to be aware. If the ground rent on a lease is over £250 pa (outside London) or £1000 pa (in London), then the lease is an assured shorthold tenancy if the leaseholder lives there. This has consequences, including the mandatory ground for possession for rent arrears (ground 8 Schedule 2 Housing Act 1988) and for the 'right of first refusal. More details here: https://nearlylegal.co.uk/2018/09/wh...s-a-shorthold/
    While on leasehold issues, this has been floating around for a bit, but I don’t think it has had the attention and awareness it deserves (perhaps particularly from conveyancers). With all the fuss/scandal around leasehold houses and multiplying ground rent clauses, a more general issue with long leases and ground rent has been overlooked. The …

    #2
    Leasehold flats are sold by developers under long lease over 99 years or 125 years and the property title is registered in the name of the leaseholder. The Lease is entered between the Lessor ( Freeholder /Landlord /Developer ) and the Lessee ( first buyer of the leasehold flat ).

    Most new leasehold flats are sold with lease requiring annual ground rent payment and its quite common to see the ground rent priced at £350 p.a for 1 bed unit and £500 p.a for 2 bed unit.

    The Long Lease is covered by the L&T Act 1985 and subsequent Housing Laws but this lease has never been called an AST agreement.

    The AST agreement is a rental agreement between the Landlord ( REGISTERED Freeholder/Leaseholder ) and Tenant ( occupant paying weekly /monthly rent ). This occupancy agreement is not related to the property title. which is kept at the Land Registry.

    Comment


      #3
      A long lease with a ground rent is a rental agreement between a landlord (freeholder, or intermediate long leaseholder) and a tenant (person with legal possession, paying a rent. If the tenant also lives there, they are an occupier.

      As far as I know AST rents can be yearly, and long lease ground rents could be monthly.

      If long leases are taken out of the AST regime, it will be because they are long, but I'm not sure that there is any such condition in the legislation.

      Comment


        #4
        Gordon999 - It doesn't matter what it is called. Whether it is an assured shorthold tenancy or not is a question of the operation of statute. Neither the length of term nor whether rent is monthly or annual make any difference. If a lease meets the conditions set out in the linked post, it is an AST, which means all the usual provisions on forfeiture and on 'right of first refusal' don't apply.

        Leaseholder64 - there is no such condition in the legislation. It is perfectly possible to have a 999 year assured shorthold tenancy

        Comment


          #5
          Does the £250 pa / £1000 pa threshold only apply to ground rent? What about other things that may be 'reserved as rent', in a lease, such as service charges?

          For example if the ground rent is only £100 pa but the service charge is reserved as rent and is another £1000 pa and the leaseholder fails to pay, is the leaseholder at risk of possession under the mandatory ground for possession for rent arrears (ground 8 Schedule 2 Housing Act 1988)?

          Comment


            #6
            This is a good question. Meaning I don't know the answer (and neither does anyone else). I suspect that a variable service charge would not count, even if expressed as rent, because it would potentially leave the status fluctuating depending on the level of service charge for that year. Also, service charge does not have to be demanded in the same way as rent, even if reserved as rent.

            Comment

            Latest Activity

            Collapse

            • Negotiating a lease extension
              by LizLease
              Hi all, I am new to the forum.
              I am looking to extend the lease on a flat (currently under 70 years).
              I received a quote from the freeholder and a valuation from a surveyor (£3k lower than the freeholder's figure).
              I spoke to the leasehold Advisory Service who said to ask the surveyor...
              21-01-2021, 12:44 PM
            • Reply to Negotiating a lease extension
              by sgclacy
              If you were to challenge the costs afterwards, almost certainly it would be dealt with as a paper review and is not as daunting as it might seem . The Tribunal generally think that around £350 plus VAT for dealing with the Section 42 Notice of claim and circa £1000 plus vat for the deed of surrender...
              22-09-2021, 13:38 PM
            • Renewing the lease and sublet charges
              by mpppen
              I've just about finished the tortuous process of renewing the lease at a flat we own bringing it up to 170 years and no ground rent (yay).

              It is rent out and I do keep getting sublet registration demands from an infamous mgm company on here.

              I've read back through the forums...
              21-09-2021, 18:47 PM
            • Reply to Renewing the lease and sublet charges
              by Gordon999
              I have some faint recollection that a complaint of " in-house legal team" was raised before a LVT or FTT Tribunal and Chairman decided "in-house team" did not qualify as "solicitor", who are required to conduct CDD ( Client Due Diligence ) before taking...
              22-09-2021, 12:28 PM
            • Example "Deed of Variation" for extending the lease term.
              by Lat
              I have tried google but there is very little to show. Does anyone have a redacted example of a "Deed of Variation" that they have had to sign?

              The criteria in my case is...

              1. Shared Freehold flat in block of flats
              2. Freeholder is Residents Company Ltd with...
              04-09-2021, 11:24 AM
            • Reply to Example "Deed of Variation" for extending the lease term.
              by Lat
              What is wrong with the following process to register the "Deed of Varation"

              All that is required of me is to get the "Deed of Variation" registered with the Land Registry and provide a copy of the new lease to the Company Secretary.

              The Process.
              1....
              22-09-2021, 12:16 PM
            • Dissolve company and regain shares
              by LaraJara21
              Good afternoon

              I am the director of a small a residents management company / limited company and We want to dissolve the limited company so each freeholder can regain their own shares. I would be extremely grateful if someone could advise on if this is possible and if so, how do we that?...
              22-09-2021, 11:35 AM
            • Reply to Dissolve company and regain shares
              by Gordon999
              The RMC has legal rights under the lease to administer the service charge account and demand annual service charge contribution from leaseholders. . It should not be dissolved because it holds the freehold title of the building.

              If you transfer the freehold title to the leaseholders,...
              22-09-2021, 12:05 PM
            • Right to Manage Costs
              by Pariah81
              Hi,

              I am part of a residents association that is exploring right to manage (RTM).

              We are a 30 flat block in the Ealing area.

              We want to get advice on the process so how much should we be expecting to pay for our legals?

              I'm also aware we have to pay...
              21-09-2021, 13:48 PM
            • Reply to Right to Manage Costs
              by ram

              You can't do that, as where is the money going to come from ?
              You cant give them back the money they gave towards the RTM - as then WHO pays for the RTM legal fees ? - You ?
              It can't come out of the service charges.
              You can pay ONE of the Directors, say $ 500 per year to administer
              ...
              22-09-2021, 10:03 AM
            Working...
            X