Leasehold clause: Not to use other than as a single private dwelling

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    Leasehold clause: Not to use other than as a single private dwelling

    Hello,

    I am selling my flat currently to a buy to let investor - an enquiry has been raised that has me a bit worried (we are in a chain, quite far progressed).

    His solicitor has queried a clause in the lease which reads exactly as follows:
    "Not to use the maisonette otherwise than as a single private dwelling in the occupation of one family and not to take in lodgers"

    I should add, there is nothing obvious that specifically calls out letting the property, this is the only clause that seems to relate to it.

    Now I was aware of this, I always assumed it referred to say my Wife and I taking in a lodger. I see it from his perspective as not being able to let it to say 2 flat sharers that are unrelated, or even letting it to an individual who goes on to take a lodger themselves.

    It's in a family area, i expect most people interested in the property will be young families or couples rather than what I would expect of a central london flat.

    Out of the 6 flats (maisonettes, it looks like 3 terraced houses with private entrances to all 6) i know at least 2 are let, I would assume they have the same lease/freeholder.

    An enquiry is out to the freeholder, i don't expect a timely reply - how do you see this going? Is this fairly standard on all leases?

    It will add salt to the wound of having just done a very expensive statutory lease extension, as previously we couldn't sell it due to high ground rent.

    #2
    That clause is both fairly standard (I'd go as far as to say it would be unusual for a flat not to have a similar clause) and it does have the implications for a BTL landlord that you have understood.

    But if the landlord is buying a flat, they're likely to struggle to find a lease without that kind of clause.
    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

    Comment


      #3
      Correct, fairly standard clause which is supposed to prevent HMOs or similar setup. Still means though the property can be let to tenants (just not to unrelated sharers). Not easy to enforce though in reality, unless you have a requirement that the freeholder has to approve all subletting in advance.

      But I wonder: what exactly has the solicitor ‘queried’ about this clause?

      Comment


        #4
        Thank you both for the prompt and detailed replies.

        The query , relayed by my conveyancing solicitor reads as follows :

        Your lease currently excludes lodgers to remain at the property and they wish for me to confirm if that includes tenants pursuant to an AST. If it transpires that it does then it is likely your buyer will withdraw.

        The guy apparently has a semi comprehensive portfolio so I would assume he or his solicitor is somewhat familiar . It doesn't help my nerves that my solicitor was so to the point, also saying he will not begin searches on our purchase until it is resolved. For context it's taken 2.5 years to get to this point!

        As an aside, I looked out the now out of date management pack from a previous sale attempt pre lease extension. It looks like standard wording added to the end but reads:

        "The leaseholder should notify the freeholder if the property is let as notice may be required under the terms of the lease."

        Comment


          #5
          You only have to notify freeholder if lease says that.

          But the solicitors enquiry is ludicrous -- what they client is purchasing IS the lease as it stands. It is not up to you to interpret the lease for them. The words you give will not prevent an AST.

          Comment


            #6
            I get the impression what they are looking for is a written response direct from freeholder saying "yes it's ok"

            Ironically it's the same solicitors that failed to educate me as a first time buyer and ended up costing us a fortune on the lease extension.

            Comment


              #7
              Originally posted by AndrewDod View Post
              But the solicitors enquiry is ludicrous -- what they client is purchasing IS the lease as it stands. It is not up to you to interpret the lease for them. The words you give will not prevent an AST.
              Agreed. The solicitor is another bright spark who should be making the tea and not doing conveyancing.

              Comment

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