New ground rent rights for leaseholders

Expensive ground rents that are crippling homeowners will soon become a thing of the past after a change in property law.

Leaseholders will be able to extend their leases to 990 years with no ground rent under new legislation. Costs for extending a lease, which can run into tens of thousands of pounds, are also set to come down under the new plans.

Ground rents levied by investors who own the freehold to people’s homes have left many leaseholders with huge bills for nothing in return.


Freeholders, who technically own the land and building, can increase the amount of ground rent without providing any benefit to homeowners. 

Some leaseholders have seen charges double at regular intervals, often rising so high they find it difficult to sell their home, leaving them trapped.

Sebastian O’Kelly, director of the Leasehold Knowledge Partnership, which has campaigned for years to abolish ground rents and reform the leasehold system, hailed the news.

“Once ground rents are banned, the entire edifice of rip-off leasehold crumbles,” he said. “The scene is then set for a far more consumer-oriented reform of the sector.”

“There is a terracotta army of professionals who depend on this not working well, and there would be endless arguments over fag-packet calculations to establish the value of freeholds or lease extensions. But with ground rents banned this racket has no future, which is a massive change.”

The housing  secretary, Robert  Jenrick, said: “Across the country people are struggling to realise the dream of owning their own home but find the reality of being a leaseholder far too bureaucratic, burdensome and expensive.

“We want to reinforce the security that home ownership brings by changing forever the way we own homes and end some of the worst practices faced by homeowners.    

“These reforms provide fairness for 4.5 million leaseholders and chart a course to a new system altogether.”


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