Leasehold Property
A lease is a long tenancy, usually granted for 99 or 125 years and the right to occupy a property under this lease can be sold during this time. It is usual for the leaseholder to be responsible for maintaining and repairing everything within the four walls of their property including floors, plastered walls and ceilings. However, the responsibility for shared facilities and the building structure usually lies with the landlord/freeholder, subject to leaseholders contributing their share of costs.
Individual leases will specify the responsibilities of both the lessee and landlord and this guide is not designed as a substitute to the lease.
MetroPM
As the Managing Agents our instructions will come from a landlord/freeholder. Our role includes ensuring that the landlord meets its obligations and enforcing the terms of leases and the covenants within that lease. We must do this to protect the landlord and ensure the development runs smoothly for the benefit of all residents.
Our role includes providing the following services and information to the leaseholders.
In general terms we will:
• Set budgets and provide a service charge estimate
• Collect service charge as it becomes due
• Arrange repairs and maintenance of the common parts and the structure of the building
• Arrange for cleaning and lighting of the internal common parts
• Arrange the gardening and upkeep of the communal grounds
• Arrange the upkeep and repair of communal installations at the property, such as lifts, door entry systems and water pumps
• Arrange and manage concierge and portering services
• Undertake routine inspections to the property in order to check all of the above
Service Charge
Service charge is the money paid by you to fund all the costs associated with running and maintaining your development in accordance with the terms of your lease. Without the payment of service charges there would be no money available to pay day to day bills such as insurance premiums; or to create and maintain a reserve fund.
Reserve Fund
We encourage the creation of a reserve or sinking fund, which is money put aside to deal with planned maintenance. By building up a reserve we are able to fund major works when required without having to wait to collect the necessary funds from the individual owners. It also means that owners are less likely to receive large unexpected bills.
Repairs
Please report any repairs affecting the main structure of the building, communal areas and grounds to us as soon as possible to enable us to take the necessary actions.
Very occasionally a problem will arise outside of normal office hours which requires immediate attention and many of the properties that we manage benefit from our subscribing to an of hours emergency service which will attend to these situations.
We would advise you that an individual lessee is usually responsible for dealing with any repairs within their flat or house or any services which exclusively serve their property. The emergency helpline is not available to deal with issues such as this.
Major Works
The lease will usually indicate the timing of external and internal redecoration of the building. Where works are reasonably foreseeable, we will endeavour to give lessees as much notice as possible so that the financial impact of these works is not too onerous. We are required to consult lessees on works that cost in excess of £250 per flat and will do so by issuing notices advising of this. We must obtain at least two estimates and provide details of these estimates and the work proposed.
Unfortunately, there are instances where emergency repairs of a substantial nature are required and this may mean that it proves impractical to consult with lessees. We will always seek to alert the lessees immediately a problem becomes known, but the actions we take will be based on the following judgments:
• Whether delay would cause further deterioration
• Whether the work is required for safety reasons
• Whether deferring the work is likely to result in significantly higher cost being incurred.
Insurance
For a leasehold property, the landlord is usually responsible for insuring the property under the terms of the lease. This will typically cover such risks as damage caused by storms, floods, fire and subsidence. The policy will also cover consequential damage-for example, if the roof leaks, the repair to the roof may be a maintenance issue to be funded from the service charge, but the damage to a lessee’s property may be covered by the insurance policy.
Points to bear in mind are:
• Most policies will be subject to an excess. This will be funded from the service charges except where the responsibility clearly lies with an individual resident, either through their own act or by virtue of an incident occurred within their own individual property.
• The policy will cover the structure of the property and the communal parts but will not cover your home contents and items such as carpets and curtains. You are strongly advised to ensure that you have your own insurance in place to cover these items.
• The policy will not cover normal wear and tear.
• Most policies will require any incidents to be reported within a limited period of time.
• Cases of vandalism or criminal damage must be reported by to the police and you should obtain a crime file reference number.
Accounting
The service charges that we collect will be held in a separate and identifiable client account, maintained under RICS regulations. Any interest earned on money in the client account is normally retained for the benefit of the block unless agreed otherwise.
At the start of the financial year we will prepare a budget of anticipated expenditure for the year ahead. This will be based largely on historic cost and as far as possible, will also provide for identified maintenance. In most cases service charges set in the year will be adequate to cover all costs. However, there will inevitably be instances where something unexpected occurs where an additional levy will be required.
At the end of the financial year, service charge accounts will be prepared by independent accountants and lessees have the right to inspect accounting records providing reasonable notice is given.
Health and safety
It is the landlord’s duty to ensure that the common parts are safe for residents, visitors and contractors.
To ensure those using the common parts of the estate are not placed at risk we arrange for a health and safety risk assessment to be undertaken by independent professionals. We also arrange any other inspections and surveys which may from time to time be required by law.
Buying, selling and letting.
Many leases prohibit the display of estate agents’ boards so please check before allowing your agent to erect one.
Most leases require that a notice of assignment is served on the landlord and some expect that the purchaser shall enter into a deed of covenant to agree to abide by the terms of the lease. Please ensure your solicitor is familiar with the requirements of the lease.
Prospective purchasers will normally require copies of the past three years’ service charge account and details of the insurance. It is in your interest to keep these documents when we send them to you as we may charge when asked to produce a duplicate.
On completion of a sale or purchase it is usually the responsibility of the solicitors acting for the vendor and the purchaser to deal with the apportionment of service charge and to make a retention or provide an undertaking to deal with any balancing charges yet to be identified.
If you are thinking of letting a property, please do not forget to consider the following: –
• Obtaining consent from the freeholder
• Obtaining consent from the mortgagee
• Informing insurance companies
Common Problems
Noise – Most leases will contain a noise provision, typically stating that noise should not be heard outside the flat between 11 p.m. and 7 a.m. In all cases, common sense must apply and the occasional party will not in itself constitute a problem. However, persistent loud music in the early hours would be classed as nuisance. If you have approached the person concerned without success you should keep a record of the problem you have experienced, complete with dates and times of the incident. You should then contact MetroPM to advise them of the problem. You might also consider notifying the environmental health department of the local authority which has separate powers to take action.
Legal action under the lease can only be considered where there is clear and substantial proof that a nuisance exists. A lessee seeking action will have to be prepared to give evidence and may be required to meet all the landlord’s costs in bringing the action.
Floor coverings – Solid floors do not absorb noise in the same way that carpet does and some leases specifically require that carpet is laid as floor coverings. If you are thinking of laying solid flooring in your property please ensure that you check your lease and ensure it does not prohibit this, and if there are no restrictions, consider the effect on neighbouring property. You do not need to have a prohibition on installing solid floor coverings to cause a nuisance to others and be in breach of your lease, and so you are advised to consult MetroPM before carrying out any such work.
Parking – You should acquaint yourself with any parking regulations in force at your block. If you have an allocated space please use this. Some leases also prohibit the parking of commercial and un-roadworthy vehicles.
Rubbish – Non-household rubbish is your responsibility and must be disposed of by you and not left in the common parts of the block. The disposal of non-household rubbish can be very expensive, and the money would be better spent on the maintenance of the building. This may also be a fire hazard.
Overflows in leasehold properties – Faulty ball-cocks in toilet cisterns are the individual responsibility of the lessee concerned. If your overflow is leaking, please attend to it as soon as possible. Apart from the annoyance to others it can cause damage to the fabric of the building if left unattended.
Aerials and satellite dishes – most leases prohibit the erection of any signal receiving equipment on blocks of flats. You should assume therefore that you are not able to do this, unless with the express written consent of MetroPM.
Subletting – If you wish to sublet your flat, you should first check that it is permitted and if so, what procedures you must follow.
If you do sublet, you must be aware that the covenants which you agreed to abide by when you signed the lease will still apply to you and your tenant. This means that if your tenant causes any breaches of the Lease, action can be taken against you. You must ensure for your own sake that your tenant is fully aware of all rules and regulations in the lease and agrees to abide by them. In particular, you should not grant any rights to your tenant that you yourself do not have under your lease.
You must provide the details of your forwarding address in order that service charge demands, and correspondence will reach you.
Pets – most leases prohibit the keeping of domestic pets so please check your lease to see whether such a ban applies. If your lease allows you to keep pets you must ensure that the pet does not cause a nuisance to your neighbours. If your pet does cause a nuisance or is frightening other residents, permission given to keep may be withdrawn.
Bicycles and prams – very few blocks have provision for keeping bicycles and prams in a secure location. However, you should not store similar items in common areas of these blocks as these areas must be kept clear for the reasons of safety. If you bring your bicycle into the block in order to take it your flat please be careful not to mark the walls or floors as it will cause deterioration in the décor of the building.
Washing – most leases prohibit the drying of washing out of windows or from balconies. Once again, knowledge of your lease will prevent any problems occur.
Security – The installation of a door or gate entry system to a property does not automatically improve the security. The following are some basic rules that should be observed: –
• Do not leave doors open when taking rubbish out or carrying shopping in from the car.
• Do not let strangers in the main door if they are waiting outside when you use the door.
• Do not open the door to someone you do not know or were not expecting.
• Always ask callers for their identity cards if you are in any way uncertain as to their identity before letting them into your flat.
• Be a good neighbour and if you see anything that looks suspicious, contact the police.
