How to read a lease
This guide explains the most common terms of a lease and clauses you may wish to refer to or Curo may rely on from time to time.
If you are thinking of buying a flat or already own a flat that is within a Curo managed building, this guide should help you understand your lease agreement.
- Key Terms
Within the lease agreement, the leaseholder will be referred to as the 'Lessee' and the freeholder (Curo) will be referred to as the 'Lessor'. Each party has covenants that they are responsible for.
Do you have a copy of your lease? Curo can assist you in gaining a copy, there is a fee of £20. Your solicitor may hold a copy of the lease, or you can often download them from the Land Registry.
- Length of the lease
This will usually be shown on the first or second page of your lease. It is very important that you know how many years remain on the lease. If you are thinking of buying a property, it is important to know this from the start. The value of your property reduces as the term (number of years remaining) of the lease gets shorter. If the lease runs out, the flat becomes the property of the landlord. If your lease has less than 99 years remaining, you might think about extending the lease. This is particularly important if your lease has just over 80 years remaining, as it is much more expensive to extend a lease which has less than 80 years remaining.
- Parties to the lease
Parties’ to the lease means the people or companies involved in the contract. Your lease will usually show the names of the original parties to the lease on the first page. If you have bought the lease from someone else and are not the first leaseholder, it won’t be your name that appears in the lease. However, your solicitor will have registered you with the Land Registry as the lease owner. The parties to a lease will usually be you and the landlord but can also include a management company, (for many flats in a Curo owned building, Curo is the Landlord and there is no management company). There can be a management company made up of the leaseholders in the building. It is very important that you understand who the parties to your lease are, if you are buying a flat, make sure your solicitor explains this to you.
- The property
Your lease will usually have a description of the property and any other areas such as a basement. This is often referred to as the demised premises. The description will normally be described near the beginning of your lease or later on in a schedule. It may also refer to a plan. Example text you might see in your lease: ‘All that ground floor flat known or intended to be known as ground floor flat (address of flat) … edged red on the plan annexed hereto.’
- Rights granted with the property
This usually refers to your rights relating to access over shared areas or other parts of the building. It may include rights of way. Rights granted to a leaseholder are usually called easements in a lease.
For example, you may need to walk down a path you don’t own and up a staircase you don’t own to get to your flat. It is clearly sometimes necessary for leaseholders to have rights over property they don’t own, otherwise they may find they are unable to access or use their own property. Your lease must provide you with a right of way for access.
The right will often be specific about which kinds of transport you can use, for example, ‘on foot only’ or ‘on foot or using a private motor vehicle’. Your landlord cannot simply obstruct your right of way or take it away. If your landlord tries to do this, you may be entitled to compensation or possibly even an injunction to protect your rights.
Please see below links, regarding the regulations, obligations and access.
These pages provide a more detailed breakdown of these areas in the lease.