11 Feb 2022

Progress for legal reform on ground rents

BY John Gebbels  

This week in Westminster the first part of a promised Leasehold Reform Bill was passed through Parliament. 

The reform addresses ground rents on new developments and restricts the levels at which ground rents can be set, limiting these a nominal 'Peppercorn' sum. 

The bill relieves new build leasehold buyers of costly future 'doubling' ground rent provisions, which can also cause difficulties in securing mortgage lending. 

Whilst the act has fallen short of addressing the same issue for existing leaseholders, the move is understood to be just the first step with further leasehold reform measures anticipated to follow. 

The new rules are likely to come into force within the next six months. In the interim period we are are recommending to clients in the process of purchasing new build leasehold property that we approach their developer to raise this issue and clarify their approach on amending proposed ground rents. For existing leaseholders approaching a lease extension, where it is feasible to delay, we are recommending holding off on agreeing terms as lease extension premiums are likely to reduce should further legislation revert existing levels to a nominal sum also. 

For more information please see the inews article below: 


To discuss the Leasehold Reform Bill, and for more information on how OXON Property Search guide and advise our clients please don't hesitate to contact us.