Back dating Ground rent increase from 9 years ago!

by Readers Question

11:05 AM, 17th August 2015
About 3 years ago

Back dating Ground rent increase from 9 years ago!

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Back dating Ground rent increase from 9 years ago!

I own a flat that I rent out. Estates & Management  have just written to me and I just wanted your thoughts as to whether this is legal as I am fuming…back

“Following a review of the lease for the property it has come to our attention that your ground rent was due a review on 1 Jan 2006.

Your lease states that the rent for your property is to be determined by the increase in the value of the block of which your property is a part of over a period of 21 years. Accordingly your ground rent has increased to £85.25 per annum.

The current balance on your account is £625.78 and an invoice will be sent to you shortly.”

I called them to clarify the content of the letter in that they were backdating 9 years worth of ground rent that they have only just increased and they confirmed it was correct.

This doesn’t sound right…. anyone else had this? and thoughts, suggestions?

Thanks, Mark



Comments

Neil Patterson

11:08 AM, 17th August 2015
About 3 years ago

Wow Mark this sounds Harsh!

I don't know the answer, but have you checked with the Leasehold Advisory service yet.

Please see >> http://www.lease-advice.org/

Mark Lynham

11:56 AM, 17th August 2015
About 3 years ago

Reply to the comment left by "Neil Patterson" at "17/08/2015 - 11:08":

very harsh.... i called them but they werent interested...

thanks for that link Neil i'll have a look at that late 🙂

Connie Cheuk

14:34 PM, 17th August 2015
About 3 years ago

You need to check your legal documents from the purchase of the property. I only have one leasehold property, managed by the seller's company Vale Management. They set the management fees, but the groundrent rises should be stated on your deeds. If they do state a rise from 2006, then their only incompetence is not alerting you or collecting it. I would check the deeds and perhaps your solicitor, too. Not paying it would put you in breach of contract (as leaseholders are one up from renting - little fish) and they could add interest. Perhaps you could negotiate a direct debit repayment rather than one hit. Hope this helps.

Mark Lynham

14:52 PM, 17th August 2015
About 3 years ago

thanks Connie... i suspect its in the lease, which i dont have a problem with, although i do have a problem with them backdating it due to their incompetence.
Also, would it have been the same increase back in 206, i suspect not.... i really do hate owning leasehold properties... or should i say ones owned by certain management companies...
so from what you're saying and from what someone else has told me today they're quite withing their rights to do this..... pretty outrageous.

Graeme

14:58 PM, 17th August 2015
About 3 years ago

If I remember correctly, even if the outcome is in the freeholder's favour, they cannot go back more than 6 years. So the ground rent from 2006 - 2009 is effectively dead and buried.......Good luck!

Connie Cheuk

14:58 PM, 17th August 2015
About 3 years ago

Reply to the comment left by "Mark Lynham" at "17/08/2015 - 14:52":

Yes - I'm selling my only leasehold property. All my others are share of freehold.

Remember that with a declining lease, they can also charge you to extend, and your property is worth less with a declined lease. Plus the maintenance costs can change.

Someone's definitely laughing all the way to the bank, and it's not you.

I would negotiate a repayment amount and make it seem like you're more than willing to pay. And yes, it was incompetence on their part, but they're holding the better hand - as long as it was in the increases are in the deeds.

But check what the chap above me, Graeme, said! Ask your conveyancing solicitor.

Best of luck.

Mark Lynham

15:13 PM, 17th August 2015
About 3 years ago

many thanks for your help.. and i'll check re the going back 6 years as anything will help!

Mike McDonagh

15:14 PM, 17th August 2015
About 3 years ago

Hi Mark,
I am assuming that ground rent has been collected and the only issue is the increase. In any case only 6 years arrears can be demanded.
Make sure that the property valuation being used to calculate the increase is applicable for 2006 and not as of today.
Cheers Mike

Graeme

15:26 PM, 17th August 2015
About 3 years ago

Another thought, Mark.
Has the existing freeholder owned the freehold since 2006 or before.?
If not, clarify what year they acquired/purchased it. They can only claim increases/arrears for the years that they have actually owned it. They cannot claim arrears/increases for earlier years preceding their ownership....

Mark Lynham

15:31 PM, 17th August 2015
About 3 years ago

ah, excellent, thank you, i'll look into this... its Proxima GR Properties Ltd that are the landlord and not sure they are the original company... also E&M took over management in 2009 which is why the guy said it had 'slipped through the net'
I think i need to compose a letter to them.

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