Flat-Living.co.uk ARMA


No let up on leasehold lettings Despite the downturn, the letting of leasehold flats is still continuing


at a healthy rate, writes Flat Living.


the letting is not done properly. Unlike freehold houses, leasehold flats come with detailed rules


F


and restrictions (in the form of the lease) designed to ensure that the flat owners live in an ordered and cohesive society for the benefit of the development overall. However, where a large proportion of the flats are sublet to tenants this society can breakdown as tenants are not stakeholders in the property as with owner occupiers and are not necessarily subject to the terms of the lease. In a survey of its members The Association of Residential Managing Agents (ARMA) found 62% of respondents reported having at least one block of flats under management where 90% or more of the flats are sublet and most blocks had at least some flats sublet.


ollowing the huge growth of buy-to-let properties from 2000 to 2007 it is estimated there are well above 400,000 leasehold flats being let out by their owners; this is over 20% of all leasehold flats in england and Wales. This can give cause for concern though when


HARD TO MANAGE


When this situation occurs the block of flats can be extremely hard to manage because the Landlord (of the block) and the managing agent have no legal relationship with or control over any tenant who is renting a flat. If the leaseholder sublets the flat and does not ensure the tenant is subject to all the same housekeeping rules as the owner occupiers then real problems arise for everyone – ARMA’s survey showed this to be at the top of the list of its members’ concerns. To overcome the issues that may arise from ill-thought out lettings


of leasehold flats, such as loud noise outside permitted hours, parking in the wrong place, excessive wear and tear of the common areas – all guaranteed to upset other residents - ARMA has produced a 12-page guide to good practice and related issues. The guide was written with the assistance of all the relevant trade and professional bodies that have an involvement with the lettings sector. Divided into a number of sections it provides


THE LETTING OF


advice to, and checklists for, all parties that could be involved in the lettings chain; from landlord and managing agent to the leaseholder and his/her letting agent. The aim of the guide is to ensure a successful letting that is compatible with the community as a whole. The extract below, for example, is taken directly from the guide and is a summary of the major concerns of lessees and managing agents about lettings in leasehold flats. With this publication to hand there is


LEASEHOLD FLATS A guide to good practice and related issues


ARMA is grateful to the following organisations for their assistance in producing this guide:


no reason why buy-to-let should be the problem it has sometimes been, so all leaseholders who are or are thinking of subletting are encouraged to download a free copy from the ARMA website, www.arma.org.uk.


Lessees’ and Managing Agents’ Concerns about Lettings • The security of blocks may be jeopardised by tenants.


• Fire safety concerns when managing agents do not know who is in occupation and tenants are therefore not informed about fire safety instructions for the block.


• Fly tipping by tenants can happen upon changeover of tenancies. • Tenants may bring in pets when they are not allowed to do so.


• Satellite dishes may be put up when they are not allowed or a communal system exists.


• Tenants move in and are not aware of parking arrangements and restrictions.


• Subletting to local authorities may increase the risk of anti-social behaviour problems in a block.


• Lettings may be as weekly serviced apartments or holiday lets which are prohibited in leases.


• Lessees who sublet often fail to give the managing agent an alternative contact address regarding problems and paying bills.


• Lettings to large number of persons may result in the creation of a house in multiple occupation with complications for the landlord and agent.


• Prohibited lettings may invalidate the block insurance policy. 29


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