Subletting fee changes since 2014?

by Readers Question

11:21 AM, 14th November 2016
About 2 years ago

Subletting fee changes since 2014?

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Subletting fee changes since 2014?

I’ve been looking through the forum discussions this morning, but haven’t found anything (yet perhaps) relating to freeholder demands for sub-letting fees over the last year or two. I wondered if there have been any changes since 2014?fee

I want to challenge SIMARC’s bill of £120 to allow me to sublet my property. They are now sending me letters demanding payment otherwise I will be in breach of my lease.

I’m new to this, but am pretty sure £120 is way over what I would expect to pay. Any advice would be much appreciated.

Kindest regards to you all.

Nicola.



Comments

Neil Patterson

11:28 AM, 14th November 2016
About 2 years ago

Hi Nicola,

This was being looked at in 2014 >> https://www.property118.com/subletting-fees-likely-outlawed/68871/

However it still appears to be a reasonably common practice and my partners Mark and Mike have been caught out on this and gone to court recently.

The amount that is charged is dependent on the lease agreement, but there is no standardised amount and £120 does not seem to be way out.

I am no expert on this but it may be worth checking out the reference site Leasehold Advisory Service >> http://www.lease-advice.org/

Mark Lynham

12:13 PM, 14th November 2016
About 2 years ago

when you say gone to court Neil, is that because you refused to pay? i only ask as i have a couple of places where the managing agaents send me the sublet letter but i just dont respond.. i am at that point again, although its with another company, First Port i believe...

Gary Nock

12:48 PM, 14th November 2016
About 2 years ago

There was also a thread from 2013:

https://www.property118.com/freehold-managers-unreasonable-fees-for-subletting-consent/61072/

There is a comment in there from me in relation to the correct notices they have to serve before the fee becomes payable. And it's got to be no less than 10 font. Simarc lost one to me at LVT on this as they try and cram the Summary of Rights and Responsibilities all on one page when its normally two.

Neil Patterson

13:12 PM, 14th November 2016
About 2 years ago

It was a case of letting the solicitors and Freeholders deal with the consent and the paperwork never getting done/recorded and being noticed years later.
Please do not ignore it as it is possible to forfeit your lease in extreme circumstances.

Paul Green

13:34 PM, 14th November 2016
About 2 years ago

Hi, I pay £120 to the freeholder for every new tenancy, if the same tenant signs a new AST it's £60 and if the tenancy turns into a periodic, there's no charge. If you don't pay your in breach of your Lease, and they can take possession of your flat. Also if your tenant causes a fire the building insurance will be invalid as you don't have permission for someone other than you to be living at that abode. Insurance premiums are higher when they know how many flats are tenanted because the risk is significantly higher, therefore the insurance company will take this risk on, Disclosure is essential which is reflected in their premiums. By not having a sublet certificate and permission from the freeholder your not only putting your own investment at risk but every one in the block. Play by the rules and do the right thing, I do and have peace of mind..... DONT Take Risks For PEANUTS. Transparency is the key...

Arthur Vickers

15:44 PM, 14th November 2016
About 2 years ago

Common to have to pay. Check your lease. Cost has to be reasonable - check this link to decisions of the Upper Chamber Land Valuation Tribunal, http://www.leaseholdknowledge.com/sub-letting-fees-should-not-be-more-than-40-landlords-are-told-four-times-by-the-land-tribunal

Mark Howe

18:05 PM, 14th November 2016
About 2 years ago

Hi, do you know if the same applies to a licence to rent our as an HMO? TIA

Dylan Morris

18:29 PM, 14th November 2016
About 2 years ago

Always worth checking your lease to see if permission to sub-let is actually required. I have a few rental flats and there is no mention in the lease of having to obtain any such permission.The flats were built by Barratts around 7 years ago. So the freeholder cannot insist on me obtaining permission or demanding any kind of fee.

I do out of courtesy provide the managing company with details of tenants and contact numbers incase of an emergency. Barratts sold the freehold a couple of years ago to SIMARC who have revalued the development, now it is overinsured and they have tripled the buildings insurance premium to provide them with increased commission. A common tactic when freeholds are bought up. Not sure if there's anything I can do about it ?

I haven't been asked to obtain permission to sub-let or pay a fee but am well aware that they could well do this in the future. Apparently this is a well known ploy to extract money from lessees who simply pay up without checking their lease. (They we will get a quick rebuke from me if they try this on).

Gary Nock

18:38 PM, 14th November 2016
About 2 years ago

Dylan Simarc will send a sub let fee letter out even if its not allowed in the lease. It's what they do. If the lease is "silent" - i.e it neither says one way or the other that sub let fees can be charged - then they can't. And on the insurance - you can always go for RTM. There are a few companies that will get RTM for you as long as they get the management. They will not pay the Freeholders fees though for you. RTM is a pretty complicated business now so find a company that has lots of experience. And don't use a solicitor who charges by the hour as an appearance at Tribunal can cost you £2000 a day. Most of the management companies that get RTM for you charge about £500 to appear at Tribunal.

Dylan Morris

18:42 PM, 14th November 2016
About 2 years ago

Reply to the comment left by "Gary Nock" at "14/11/2016 - 18:38":

Thanks Gary but as there are around 100 apartments in the development I thing getting the agreement of owners to from an RTM will be very difficult.

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