How does leasehold work on flats?

Leasehold ownership of a flat is simply a long tenancy, the right to occupation and use of the flat for a long period – the ‘term’ of the lease. This will usually be for 99 or 125 years and the flat can be bought and sold during that term. The term is fixed at the beginning and so decreases in length year by year.

Who owns the head lease?

Landlord: Typically, this is the freeholder but there are situations where your immediate landlord is the ‘head leaseholder’, not the freeholder. A ‘head leaseholder’ will be the leaseholder with the longest lease, who has leased your flat to you and who pays ground rent to the freeholder.

What are the rules for leasing a block of flats?

The main criteria are that: the building must be a self-contained block of flats (which includes a converted building as well as a purpose built one) the building must have no more than 25% non-residential use. a qualifying tenant is one who holds a flat under a long lease, i.e. for a term of more than 21 years when the lease was originally sold.

Can a leaseholder do what they want with the flat?

Leaseholders are not necessarily entirely free to do whatever they want in or with the flat – the lease comes with conditions, to protect the rights of everyone with an interest in the building. For example, retirement schemes will usually have restrictions on the age of those who can live there.

Can a leasehold flat be sold without written consent?

In this way the landlord or management company has a direct contract with the buyer and prior notification of the new lessee. A typical lease will require that the sale or mortgage of the flat cannot take place without the prior written consent of the landlord.

Can a tenant take over management of a block of flats?

The Commonhold and Leasehold Reform Act 2002 has given a new right to tenants of blocks of flats to take over the management of their building without having to acquire the freehold or having to show fault. Under the Landlord and Tenant Act 1987, it is possible to appoint a manager but the tenants have to show fault.

What’s the lease of a flat in a block?

A residential lease of a flat in a block between a landlord, management company and a tenant with full service charge provisions where the intention is to transfer the reversion to a tenants’ management company.

What do you need to know about leasehold ownership of flat?

The leasehold ownership of a flat usually relates to everything within the four walls of the flat, including floorboards and plaster to walls and ceiling, but does not usually include the external or structural walls. A garden can be included, unless it is a communal garden for the building.

Can a landlord give consent to the sale of a block of flats?

Agents and landlords will not give consents, deeds of covenant or register sales if debts are not paid. Many blocks of flats are owned and/or managed by the lessees who live in them. Often anyone owning a flat has to also become a shareholder or a member of a company set up in which some or all lessees are shareholders or members.