Leasehold and extension

[magicstar123]

Nc for this out of paranoia

Not sure whether to post here or legal but hopefully someone can offer some guidance...

We have just (in the last year or so) completed a second floor extension on our house which is a leasehold property. Prior to this, my husband (before I was on the scene) also extended the small kitchen into a much larger one.

For both extensions, we have failed to obtain permission from the leaseholder (which is a large property company).

To be honest I was completely unaware of this issue and my husband had buried his head in the sand over it.

Of course we are now panicking and wondering how to put it right so that it isn't an issue if we decide to sell later down the line. We've enquired about purchasing the freehold but apparently that doesn't remove the restrictions around the extension. Not sure whether to approach them to get backdated approval as we want to know what they could throw at us for failing to do this upfront.

We've read online that they could charge us 50% of the increase in value of the house?!

Does anyone have any experience of this?

We had this with an over-enthusiastic tennant who thought he owned the property (he was deluded) turns out everything he did we couldn't trust was to reg standard so had to knock it all down. The courts backed us - but we still lost money over it. I know you own the property but not informing the leaseholder was a bit off... book a meeting with her/him/them and apologise and see what can be done to formalise things now.

forums.landlordzone.co.uk/forum/conveyancing-questions/1039293-leasehold-house-extension-without-freeholder’s-permission

Thanks for your response. I think our situation is a bit different from yours to be honest. We're not tenants. Everything has been done above board, building regs, planning permission etc. We just missed the restrictions on the leasehold agreement.

Does anyone else have experience on this? The leaseholder is a huge property company so it's not as simple as meeting up to apologise, I imagine they have set procedures that they'd follow.

Cross post mumwon, thanks I'll take a look!

You mean freeholder. I thought the price of the freehold was based on the difference between the value of the property with a lease, and the value if freehold. A 999 year lease is virtually freehold, so can't imagine the value is that different.
As for your building works, get the info about where you stand from your solicitor.

Sorry yes, obviously do mean freeholder! Thank you, that is reassuring. I'll do some further digging around that point.

You need to just apply for retrospective permission from the freeholder and they will grant it (assuming you have planning and building regs which sounds like you do)

The application to the freeholder will come at a cost I'm afraid. Normally some where between £700 and £2000

Thanks tiger. We're prepared for that cost, just panicking about any sort of 'punishment' that we may be charged with for not getting permission upfront!!

Write an apologise that you realise you failed to understand the requirement to speak to the freeholder before proceeding with building works. Admit it was your error and you have only recently become aware of what you should have known. If you are able to say that it was all done with proper buildings regs and planning etc that would be good. Apologise again and ask them to advise you about the next steps to rectify your omission. Include with your letter details about what exactly has been done with pictures and also the planning consents/regulations.

If you admit the error and send full documentation now, you will put yourself in the best position. There might be a financial cost, but it probably won't be high......and they would prefer you to say upfront rather than be found out. And of course it will come out if you sell, if not before,

FWIW I bought a leasehold flat which had had its Windows replaced without permission from the freeholder. The solicitor identified the issue but the freeholder wasn't worried about pursuing it. As the double glazing company had since gone bust and the sellers didn't have a FENSA paperwork any longer, the seller had to pay for an indemnity policy (about £100) to cover the lack of it. It didn't delay the sale.

Presumably applying for permission would have cost you (possibly why you didn't apply??) so you can expect to pay whatever those costs would have been if done at the right time. If everything has been signed off, that might be the end of it and the cost to cover retrospective permission. If there is anything that isn't legit about the building work you could face many more issues such as demands to remove. There might be penalty terms for not sticking to the leader permission terms, but any penalties would need to be specified.

As you've said, the freeholder will probably ask you to pay a premium which is 50% of the increase on the value of the property. It needs sorting so best to tackle it head on. Get a surveyor round to do a valuation so you have the figures.

Thanks wombat and planet. Definitely didn't try to avoid any initial cost, pure ignorance from my side and not sure what my husband was thinking!!

planet I was hoping the 50% of increase in value was a red herring!! Have you seen this in practice? It seems so punitive.

Hi OP,

The kitchen is less of an issue - presumably structural in that you moved walls but within the original space? So long as you've got all the regs etc then it's just a case of applying for retrospective consent. It happens all the time.
When you say a second floor extension, do you mean you've extended into land you don't own or it is just that you've put a bedroom above a part that was only single-storey before? If it's the latter, that should just be a retrospective consent application too.

Hi GU24Mum, you sound like you're speaking from experience! the kitchen extension extended into the garden space, does that mean we have to check if our lease terms cover the garden? Does it make a difference? I presume we 'own' the garden land as much as we do the house...but I am clueless really.

The second floor extension involved moving the garage door forward by a foot (into the drive) but other than that just went over the top of garage.

Thanks for your help

Hi OP, if it's a leasehold house rather than flat then you're unlikely to have extended over someone else's demise but probably good to double check your lease first as that would be more of an issue!

Hi GU24. Thanks so much for your help! I have sent you PM just to clarify my thoughts, rather than continuing to waffle to everyone on this thread :) I hope that's ok.

There was a case a couple of years ago where the leaseholder did some upgrades to a kitchen and did not get the freeholders permission first and refused to revert it back to how it was, the freeholder went to court and the leaseholder lost their house and the judge gave it to the freeholder. It was in a national newspaper can't remember which one, Google might know.

I dint understand why, if you purchase the freehold that you don't remove the problem? Are there other properties joined in which case you couldn't buy your own feeehold it would have to be done in conjunction with others I believe but this don't sound the case?

Not sure marie, I guess purchasing the freehold wouldn't retrospectively remove any obligations that had previously applied. A shame as we thought we'd be able to resolve it taking that route.

Oh jimmyjammy don't say that!! I don't see why the freeholder would want us to reverse the work, it's only improved the house so they'd be cutting their nose off to spite their face...

I remember that Jimmy but it was extreme

Umm if you buy the freehold you are then the freeholder from whom consent would need to be sought. You could grant yourselves retrospective permission. Your only issue (barring sonething else in your lease/title) would be if the property was inspected to determine the value of the freehold before you purchased. Check/ ask for your freeholders procedure for purchasing the freehold from them is. If a house on a 999 year lease where the extent of the freehold plan and leasehold demise are identical they may calculate based on ground rent and legal fees alone. One of the few pluses of it being a big company is that you should be able to find out both the consent procedure and the enfrachisement procedure easily then weigh up what you want to do.