Planned Changes to Ground Rent

By Maxine Iremonger

The government has recently announced some good news for leaseholders who pay ground rent. They are proposing that ground rent will be capped at £250 a year changing to a peppercorn rent after 40 years, which will result in millions of leaseholders across England and Wales paying significantly less in ground rent than they do at the moment.

The rising cost of ground rents has been a concern to leaseholders for many years, and this new legislation will put an end to escalating ground rent charges. It is envisaged that this change in law will unlock the sale of leasehold properties whereby leaseholders have been unable to sell their properties due to ground rent terms that make their homes difficult to sell.

It is also planned that new leasehold flats will be prohibited through the draft Commonhold and Leasehold Reform Bill published in January. Forfeiture, whereby leaseholders can lose their home by defaulting on a debt as low as £350, will also be abolished and a new enforcement regime will rebalance the system.

The Leasehold Reform (Ground Rent) Act 2022 has already ended ground rents for most new long residential leases; however, this announcement focuses on unfair and unaffordable ground rents on older leases. The draft Bill will now move into the pre-legislative stage and could come into force in late 2028.

If you are considering buying or selling your property, Sampson Coward’s dedicated team of experienced Conveyancers are happy to assist with your conveyancing transactions. For more information contact Maxine Iremonger on This email address is being protected from spambots. You need JavaScript enabled to view it. or 01722 410664.

Maxine Iremonger