Leaseholders

What is a leasehold?

If your home is a flat or maisonette, it is part of a larger building which is divided up into individual units. There may be another property above, below or next to you, but still within the same building.

This can be defined as ownership of a property that is not independent but shares such things as the roof, entrance hall and stairs. The shared items need to be maintained for the benefit of all the individual residents and the costs will be shared amongst them.

What is a lease?

Your lease is a type of tenancy and is a legal agreement between you and your landlord. It allows you to live in your home for a set period of time. This is known as the lease term.

If you bought your home on the open market the seller will have transferred the rights and responsibilities in the lease to you for the rest of the term.

The terms of a lease cannot usually be changed by either party without the other’s consent. The government sometimes makes changes to leasehold legislation and this can override the terms of existing leases.

Not all leases are the same and it is possible for two neighbours to have slightly different leases. This is because some of the lease clauses have been amended over the years to take into account changes in legislation and leasehold best practice.

The lease details the Rights and Responsibilities of both the leaseholder and the landlord. Whilst this is not a complete list some of the more common ones are shown below.

What are the Leaseholder’s responsibilities?

• To pay ground rent and service charges, including major works and repairs costs.
• To keep the interior of the flat in a good state of repair and the windows properly cleaned.
• Not to make any structural alterations without the prior written consent of the Landlord.
• Not to use the premises for any illegal or immoral purpose.
• Not to use the property for any trade or business purpose and only to use it as a private residential flat.
• Not to do anything which may be a nuisance, annoyance or cause damage or inconvenience to either the Landlord or any other resident.
• Not to cause an obstruction in any of the communal areas of the property.
• To give reasonable notice before accessing other parts of the property to carry out repairs or maintenance that the leaseholder is responsible for. This should be at least 48 hours unless in cases of extreme urgency. If whilst doing the work any other part of the property becomes damaged this must be made good by the leaseholder.
• To permit the Landlord and the owners of other flats to have access and to enter upon the premises to fulfil their obligations.
• To comply with any regulations which the Landlord may make to govern the use of the flats and the Reserved Property.
• If you wish to sell the flat within 10 years of purchasing it under the Right to Buy or Right to Acquire you must give your Landlord the option to purchase the flat first. If selling within 5 years of that date you must pay a sum to the Landlord.
• Not to erect any external wireless or television aerial or any pole or flagstaff.
• Not to place a window box outside any of the windows without the prior written consent of the Landlord.
• To pay a reasonable proportion of the expense of repairing and maintaining all unadopted private roads and footpaths on the estate.
• To keep properly clean and tidy any parts of the property that were the responsibility of the first leaseholders when they were tenants prior to completion of the Right to Buy or Right to Acquire.
• To observe all the terms and regulations set out in the lease.

What are the Leaseholder’s rights?

• To peaceably hold and enjoy the premises for the term of the lease.
• Access to the communal parts of the property and use of any communal facilities that have been provided in the property.
• Passage of gas, electricity, water, etc. to and from the premises.

What are the landlords (Plymouth Community Homes) responsibilities?

• To maintain and repair the exterior, structure and common parts of the building.
• To give reasonable notice to residents if access is required to the premises. This will usually be at least 48 hours except in cases of extreme urgency.
• To keep the building insured to the full cost of re-instatement. (This is for buildings only and does not cover contents. Leaseholders will need to arrange contents insurance separately)
• To keep proper accounts of all costs and expenses incurred in carrying out its obligations.
• To manage the block and estate in a reasonable manner.

What are the Landlords (Plymouth Community Homes) rights?

• To enter the premises with or without workmen, at reasonable times, to examine the condition of the premises and the right to issue a notice specifying any repairs or works necessary to be carried out by the leaseholder.
• A right of access and entry upon the premises for the proper performance of its obligations.

PCH has arranged a block insurance policy to cover all of its leasehold flats. You can find a summary here.

This is a buildings insurance policy and leaseholders will need to arrange insurance for the contents of their homes separately.

If you would like to make an enquiry regarding your annual service charge, we are encouraging leaseholders to contact us.

If you’re a leaseholder and you’d like to make an alteration to your flat, for example removing an internal wall, changing windows or the front door, erecting a fence or wall outside, you need to get written permission from PCH.

Permission is important, and you’ll have to get it from us in writing before the work starts. We won’t unreasonably refuse permission, but we do have a responsibility to keep others in your block safe.

To apply for permission to make alterations, complete the consent form and send it to the Leasehold Team at the below address. 

Please give us as much notice of alteration works as you can.

Advance Consent Form

Leasehold Team, Plymouth Community Homes, Plumer House, Tailyour Road, Plymouth, PL6 5DH.

To talk to someone about your application, please call 01752 388094.

Why would I want to extend my lease?

The length of a lease can significantly affect the value of your flat. The sooner the lease is due to expire, the less your flat may be worth and the more expensive it can be to extend the term of your lease. Sometimes it can be difficult to sell your flat as buyers usually look for a flat with a long unexpired lease and they may find it difficult to get a mortgage if it has a short lease term left. This is because mortgage providers have their own requirements on lease terms before they will offer a mortgage. However, this may not affect you as most of our leases still have many years left to run.

When should I consider extending my lease?

You may have problems selling your flat if it has a remaining term of less than 80 years and most mortgage lenders require an unexpired lease term of at least 60 years.

How long can I extend my lease for?

Under the Leasehold Reform, Housing and Urban Development Act 1993 (The Act), you can add 90 years to the remainder of your lease term. For example, if your lease has 100 years left to run, you can have a new lease for 190 years.

Will the ground rent increase?

No. You will only have to pay what is known as a ‘peppercorn’ ground rent, which means no rent at all. The price that you will pay for the new lease will take this into account.

How much will it cost?

In addition to paying the purchase price to us for the new lease, you will also pay our reasonable legal and surveyor costs and an administration fee.

We will be able to provide you with an estimate of what these costs may be before you make a formal request to purchase a new lease.

What if we cannot agree on how much the new lease should cost?

We will try to reach an agreement with you on what the purchase price will be. However, if this is not possible you can apply to the First Tier Tribunal for a determination on what the price will be.

What do I need to do to purchase a new lease?

1. Check your lease

The lease term will be stated in your lease and you will be able to calculate how many years there are left to run. Please note that the term may not start on the date when the lease was purchased because the first flat sold in the block sets the lease terms for all future flats sold in your block.

2. Check your eligibility

You can extend your lease if you have owned your flat for at least two years.

If you qualify, you can extend your lease for a maximum of 90 years by paying a purchase price for the lease extension.

We do not have to extend your lease if:

• The majority of the leaseholders in the property have applied to obtain the freehold
• Your lease has already expired
• You have sublet your flat on a lease of at least 21 years
• We want to demolish or redevelop the block of flats.

3. Appoint Professional Advisers

It’s recommended that you consider appointing professional advisers to assist you at an early stage. A valuer will be able to advise you on the price you will need to offer for the new lease and a solicitor will be able to deal with the legal aspects for you.

The valuer (usually a chartered surveyor) will calculate the value of the lease extension using the formula set out in the Act. You can contact the Royal Institute of Chartered Surveyors for a list of local surveyors who specialise in lease extensions. Most surveyors will charge a fixed fee to prepare the report which will cover the initial inspection of the flat, reading the lease and making the calculations. For any further work required – such as negotiations with us – their fee will increase.

The solicitor will be able to start the process by serving the Initial Notice on us. The notice will include the amount you wish to pay for the lease extension. At this stage we will require you to pay a deposit of £250 or 10% of the amount that you are offering for the lease extension (whichever is greater).

Please note that once the Initial Notice is served on us, you are responsible for our reasonable valuation and conveyancing costs.

4. Dealing with Us

We have a minimum of two months in which to respond to the Initial Notice with a Counter Notice. If we do not respond within this period you can apply to the county court for an order that the lease extension is granted on the same terms as set out in the Initial Notice.

5. Valuation Agreement

If the valuation figure cannot be agreed you can make an application to the First Tier Tribunal for a decision. This must be made within six months from receipt of a valid Counter Notice. If the valuation cannot be agreed within this period the Initial Notice is considered withdrawn.

Please note that you will have to wait 12 months before making a fresh claim under the Act.

6. How much will the lease extension cost?

This is difficult to say as the value consists of three main elements.

• Compensation to us for loss of Ground Rent
• Compensation to us for not receiving the flat at the end of the lease.
• If there is less than 80 years left to run, ‘marriage value’, which is arrived at by deducting the value of your flat before the lease extension from the new value plus the value of our interest.

Please remember that you’re responsible for our costs as well as your own.

7. How long will it take?

This depends on how efficient everybody is and if the valuation is agreed but it could take up to 12 months. If the court becomes involved this will delay the process but there are legal timescales in place to prevent it from dragging on.

If, after reading this leaflet and having taken your own professional advice, you decide that you want to extend your lease, you should send your written request (Initial Notice) to:

Leasehold Team, Plymouth Community Homes, Plumer House, Tailyour Road, Plymouth, PL6 5DH.

Please note that this is a brief outline of the process. You should take advice from an appropriate professional – such as financial advisers, solicitors and surveyors – before making any decision. Your solicitor will be able to advise and guide you.

For more independent information and guidance on extending your lease, the following independent website is worth visiting www.lease-advice.org.

As a Leaseholder, we value your views and experiences and want to make sure you have the chance to be involved in shaping the services we deliver.

We believe it is important for Leaseholders to have the chance to meet key members of our business, understand the work PCH is planning to carry out and have a say in how our services are delivered.

Our Leaseholders Forums are held twice a year and we'll send all our leaseholders an invitation to join closer to the date.

You can look back at our previous forum presentations below:

• July 2021

When the property needs repairing, what type of repairs can the leaseholder do?

The leaseholder is responsible for maintaining the parts of the property that the lease describes as being ‘Demised’. This includes the inside of the flat and any apparatus, pipes, wires, etc. that are used solely by the flat.

I have a leak. Who is responsible for completing the repair?

If the leak is from a pipe that is used solely by your flat it will be the leaseholder’s responsibility to get this fixed. The Landlord is responsible for communal pipework. A leaseholder’s responsibility for pipework usually commences from the water meter.

Can I arrange my own buildings insurance?

The simple answer is no. Under the terms of all leases the Landlord is responsible for arranging this for all leasehold flats in the property. In view of the number of properties involved the annual premium tends to be much lower than if you had arranged your own separate insurance.

What is covered under the buildings insurance policy? I am not sure whether to claim for my bath under the buildings or contents insurance.

The policy covers the structure of the property together with any fixtures and fittings in the flat. Items such as bath, washbasin, sinks and toilets which are fixtures in the flat are covered under the buildings insurance.

Can I paint the outside of my flat?

The Landlord is responsible for maintaining the outside of your home and therefore external painting will be the responsibility of the Landlord.

Does Plymouth Community Homes make a profit out of leaseholders?

No. Plymouth Community Homes is a non-profit making organisation and a registered charity. We do not make a profit from leaseholders but we are expected to cover all costs when complying with lease terms and providing services to leaseholders.

My lease says that I cannot make any alterations or additions to the premises without the prior consent of my landlord. How does this work please?

This does not cover such things as internal decoration or routine maintenance. If you would like to make an alteration to your flat, for example removing an internal wall, changing windows or the front door, erecting a fence or wall outside you will need to get written permission from your Landlord before any work starts. We will not unreasonably refuse permission but we do have a responsibility to keep others in the block safe. To apply for permission please write or email the Leasehold team and we will pass your request to a qualified surveyor who will be able to consider this for you.