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Freehold Flat sale to lifetime tenant

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  • Freehold Flat sale to lifetime tenant

    Tearing my hair out and hoping someone has some advice or even just some calming words.

    I own a share of freehold purpose built flat and am currently in the process (hopefully) of moving to another property.

    Our buyer and their solicitors have turned out to be much more difficult than we first imagined.

    The gentleman who will live in our property is looking to retire in the flat. He is selling his own property and our flat is being purchased on his behalf by a company. Basically they are buying the property and he will keep the proceeds of the sale of his own home, then paying a rent to the company to live in our property.

    We have incurred significant expense thus far in the sale due to the level of questions that have been raised by the company purchasing and their solicitors. In turn this has led to a lot of costs with the management company for the preparation and re-preparation of said documentation.

    The most recent issue relates to the underletting of the property. There are 8 flats in the block and a number of these are currently rented by their owners.

    The buyers solicitors have requested the permission be expressly granted for the underletting of our property by them to the planned tenant.

    Our management company have offered wording around this matter stating that as long as agreement is reached that someone will cover the service charge (purchasing company or the tenant) they see no reason why consent cannot be granted.

    However the purchasers solicitors have expressed that they are not comfortable with the wording and have offered revised wording.

    The management company have now made 2 points.

    1, there is nothing in the lease stating that any consent is required, i.e why is this a problem

    2, If the buyers solicitors are adamant this must be in place then the Directors of the freeholders must confirm that they are happy in amending the lease to provide future coverage. We have been informed (by director of freeholders) that this permission will only be granted upon them taking legal advice. In short they are concerned that this might set a legal precedent that lifetime tenancies can be granted and that in turn in theory housing associations might get hold of other properties in future and place undesirable tenants in to the flats.

    As above, we've incurred significant costs and delays in the process thus far and one of the others in our chain is very close to pulling out due to the delays.

    Given that if the other side are adamant about having the surety in place, there will be further costs to us and further delays we are worried we will end up in one of 2 scenarios.

    1, The legal advice suggests that they will not grant consent and we then lose our buyer.

    2, we proceed, incur further expense in getting the consent, only to find that the others in the chain get fed up of waiting and pull out. Hence we spend the money but it's to late anyway.

    This is a long post, so I won't go into full detail but the process has dragged (IMHO) due to delays from the other side and they've not been the easiest to deal with.

    Do you guys think we should pull out, given the general issues and the risk of yet more spend for no successful outcome, or should we continue?

    Any thoughts or other ideas gratefully received,

    Pendley

  • #2
    Re: Freehold Flat sale to lifetime tenant

    p.s think I might have posted in wrong place, i'll now copy to the selling room.

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