A new lease of life: - CentreForum

A New Lease of LifeFreeholder control over leasehold propertydevelopmentA significant issue arises when freeholders charge leaseholders forconsent to amend their properties. This occurs because most leaseagreements contain a clause requiring consent, designed to protectthe freeholder from losing value and to allow them to prevent workwhich would harm other properties. It is often used today howeverto claim unwarranted premiums from leaseholders who are seekingto improve their homes.Freeholder control is especially problematic with leasehold houses,where external amendments such as conservatories and garagesare more common than with flats. In particular, houses sold on 999leases have a greater likelihood that problems will arise becauseleaseholders often consider themselves to effectively be freeholdersand may not revert to their lease agreement or realise that consentis required before commissioning work.In many cases freeholders demand significant administrativecharges for considering an application and granting permission,which can leave leaseholders with little option other than paying upor cancelling planned development. In other circumstances, whereleaseholders have not gained permission prior to commencingwork, freeholders can demand a fee in retrospect. If an amendmenthas already been completed, freeholders can threaten forfeiture ifthe requested payment is not made. This means that, in most cases,leaseholders will pay the fee demanded even when it is unjustifiablyhigh.Leaseholders also face problems when they wish to amend theinterior of their properties where leasehold agreements requirefreeholder consent. For example, a lessee wanting to install ashower can have to apply to their freeholder, who, in turn, cansimply grant permission, demand a fee for doing so or imposeunnecessary sanctions. 79The rationale behind control over interior development could againbe that it protects freeholders from changes which will reducethe value of their asset and they must retain control to preventdevelopment where it will harm a building’s structure. But thispower is open to abuse by freeholders demanding premiums for79 This is despite the fact that leases generally give repairing obligations to thefreeholder for the external parts of the building, services and installations, butleave matters within a unit’s interior walls to the leaseholder.45