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What is a “house”?

What is a “house”? This is a question which is becoming increasingly important, given the number of properties which are being converted to residential use, and occasionally back again.

In the recent case of Grosvenor (Mayfair) Estate v Merix International Ventures Ltd and another [2017] EWCA Civ 190, the Court of Appeal considered the question: “what is a house?”.

The property in question was unoccupied and had been used at times both as offices and residential accommodation, but did that make it a “house?”

The Leasehold Reform Act 1967 states that a qualifying tenant of a house may be able to buy the freehold or take a new lease for an additional 50 years. In this case, the tenant claimed the right to buy the freehold of an old Victorian townhouse. The tenant had lived upstairs, while the lower floors had been used as offices. The whole property had then stood empty for 13 years.

The High Court and then the Court of Appeal both decided that the whole building was indeed a house, not an office block. The Court held that buildings are “infinitely variable in character and function”. Just because this property looked internally like a derelict office, did not mean that it was not, in fact, a house. The tenant of this derelict building was therefore entitled to exercise its right to buy.

This is an important reminder to property developers and investors to carefully assess any derelict or mixed use property, in order to assess correctly the lawful use of the property, and so to avoid any nasty surprises.

Find out more by reading our real estate law page, or get in touch with our team directly.

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For more information on this story, contact Alastair Frew on 01789 206117 or by email.