Considerations when altering a leasehold residential property

What you should consider when making alterations in your leasehold residential property?

Lease covenants

Lease covenants about alterations usually fall into two categories, an absolute prohibition on alterations or a qualified covenant. An absolute covenant means that you are not allowed to make any alterations to the property. Should this be the case, you may attempt to negotiate with the landlord possibilities of obtaining consent. This may need to involve the payment of a premium to the landlord as an incentive to grant consent. The landlord however is not under any obligation to agree to your alterations no matter how much value this may add to the property.

A qualified covenant may permit certain alterations subject to obtaining the landlord’s consent. In such circumstances, there is an implied obligation on the landlord not to unreasonably withhold or delay consent. There is no clear answer as to what constitutes reasonably withholding consent. It will depend on the individual facts and circumstances.

In certain circumstances, your landlord may provide their consent subject to certain conditions. These conditions may be the payment of their legal fees and / or payment of a reasonable sum for any damage to the property or diminution in the value of the freehold interest of the property. Your landlord may also request an undertaking from you to reinstate the property at the end of the lease term. Any application under the lease will normally require you to pay the landlord’s reasonable costs, whether or not consent is given.

Planning permission

In addition to considering whether landlord’s consent is required, you will also need to consider whether you need planning permission, Building Regulations approval or Party Wall Awards. You may need the consent of any lender as well. You should also note that if you have a share of the freehold or are a shareholder in the landlord company, you will still need to obtain any consent under the lease from the other freehold owners or the company.

As a rule always make sure you have the consent in writing as you may need to provide this to a buyer when selling the property.

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