Leonard Kasler & Company
Buying a London Property
(20 Things to Know)
1. Large areas of London are owned by the old landed Estates, who have held them for centuries
2. Examples are the Estates of the Duke of Westminster, the Cadogan Estate, the Howard De Walden Estate
3. The English Church Commissioners own a lot of land too
4. Their policy over the years has generally been not to sell their land outright, but to give a HeadLease of whole buildings
5. They plan to look after these Buildings for generations and are not thinking about the short term
6. The HeadLeases may be for a fairly short period e.g. 60 years. They will collect the rent during the term of the Headlease and at the end, will renew for another generation or so
7. Meanwhile, these old houses have become too large and expensive for the modern life led by most people
8. Lessees convert them into flats (with the permission of the Landlord Estate)
9. Each flat is "sold on long UnderLease" and the terms of the UnderLease invariably reflect those in the HeadLease of the whole building
10. The UnderLease of the Flat cannot end after the HeadLease of the whole Building. Sometimes, quite short UnderLeases can result
11. You will want advice as to what happens at the end of the UnderLease
12. In some areas of London, these short UnderLeases can be expensive. They are usually in the more prestigious parts and the Buyers generally do not require to borrow money to buy them
13. Lenders are generally reluctant to lend on the security of a Lease or UnderLease with less than 65 years left to run
14. There will be a lot of documentation to evidence the ownership of the Flat – the Estate’s title, the HeadLease of the whole Building, the Licence to convert the Building into flats, the UnderLease of the Flat
15. This is just the beginning! Your Solicitor will check out all the above.
16. You might be more interested in knowing about the management of the Building and its upkeep
16.1. Are there any Major Works anticipated?
16.2. Is the Landlord committed to providing a Porter, the Underground Parking, the Lift, the Air Conditioning or any other amenity?
16.3. Does Insurance cover any accidental damage?
16.4. What happens if one of the neighbours creates too much noise?
17. There will, no doubt, be a financial commitment by you to pay a contribution ("the Service Charge") towards the provision of all these facilities. You will want to have the Accounts looked at with a critical eye.
18. You might wish to use the Flat for a business or some other purpose. This may or may not be allowed under the terms of the UnderLease
19. There is a huge amount of information to collect in, check and report on, so that you have peace of mind
20. Nevertheless, many English Solicitors are accustomed to handling such transactions at speed, for a reasonable fee and (with modern technology) for clients living abroad
Michael Breeze
Leoanrd Kasler & Company
Sunday, 13. October 2002