Block Management Update - May 2023
Welcome to our periodic update on Block Management News
We aim to regularly update our Leasehold clients with Industry information, activity within our business, and general items which we think you may find beneficial.
Government Updates Lease Extension and Variations Guidance:
The Property Institute (TPI) wrote to the Government last month to raise concerns over possible issues with the existing guidance and regulations for leaseholder protections in relation to the requirements for a 'qualifying lease at the qualifying time', namely being that upon surredering a lease and having a new lease granted, the lease may then become non qualifying and leaseholder protections become lost. The Government has responded to the concerns raised and updated the guidance as per the below;
“8. we are aware of the issue concerning leaseholder protections where
leases are extended or varied. we expect landlords to make sure that
lease extensions and variations reflect a qualifying leaseholder’s current
• 9. If you are a qualifying leaseholder and you extend or vary your lease, you
may surrender your existing lease and be granted a new lease. as the new
lease will not have been granted before 14 February 2022, the statutory
leaseholder protections in the Building safety act 2022 will not apply. We
are looking to legislate to resolve this issue as soon as Parliamentary time
allows. In the meantime, before seeking a new extended or varied lease,
leaseholders should seek legal advice and seek to come to agreements
with landlords to apply the same protections as contractual terms.
• 10. where this is not the case, we encourage leaseholders to write to the
department under the subject heading ‘Lease extension and variation
evidence’. along with providing the details of landlord practice, any relevant
correspondence, and contact details….”
Introduction of a Use Class for Short Term Lets
Due to concerns over the impact of Short Term Lets in some areas, a new use class has been proposed for these properties. The rationale is that the increase in the number of short term let properties in coastal towns, cities and some more tourist centred areas can have an effect on the availability and affordability of homes to buy or rent for the local population. The planning measures would mean that local areas have greater ability to control any future increase in the number of short term lets in their area.
This could be applicable to properties in Malvern in particular, which has seen a significant increase in tourist visitors post pandemic - which is great for the town, but could have an unitended knock-on effect locally.
Many leases prohibit the use of the property as a short term let and there may also be buildings insurance issues with short term use. We strongly advise that if you are considering using your property as a short term let that you engage with your Managing Agent prior to doing so in order to ensure that your lease would not be breached or insurance invalidated.
Please find below two links to articles which may be of interest;
Many of the sites for which we act are in the process of having their periodic declared value assessment, you may see a surveyor from GJS Dillon on site conducting this work.