Ground rent
Ground rent is a regular payment made by a leaseholder to a landlord. Ground rent is generally only a small amount, typically £50 to £300 a year. Since the introduction of the Leasehold Reform (Ground Rent) Act 2022 in many circumstances ground rent is banned, with a number of exceptions.
The lease should set out:
- The amount of the ground rent.
- The payment dates (usually annual).
- The circumstances under which the ground rent can be increased.
Ground rent is only payable when the landlord asks for it formally, setting out:
- The name of the leaseholder.
- The period covered.
- The amount.
- The name and address of the freeholder.
- The name and address of the managing agent if payment is to be made to them.
- The due date.
- 'Notes for Leaseholders' informing leaseholders of their rights and responsibilities.
Failure to pay ground rent can result in legal proceedings, and in very extreme circumstances could lead to eviction.
As ground rent is typically very low, some landlords can fail to collect it, however, they can only recover it going back 6 years.
Ground rent can generally only be increased if the lease permits, or if the leaseholder agrees to an increase, or if the property is sold.
If a leaseholder extends a lease under the Leasehold Reform, Housing and Urban Development Act 1993 they then only have to pay a ‘peppercorn rent’ effectively a ground rent of nothing. If a lease is extended by negotiation ground rent may still be payable.
Other charges that might be made by a landlord include; service charges, consents to make alterations, the provision of information when a property is being sold and so on.
[edit] Related articles on Designing Buildings
- Betterment.
- Break clauses in leases.
- Built to suit.
- Buy-to-let mortgage.
- Dilapidations.
- Housing tenure.
- Landlord.
- Leasehold.
- Leasehold Reform (Ground Rent) Act 2022.
- Lease Negotiations - Tenants Checklist.
- Licence to alter.
- Peppercorn rent.
- Property guardianship.
- Rent.
- Rent-free period.
- Rent review.
- Reversion.
- Schedule of dilapidations.
- Scott schedule.
- Service charge.
- Supersession.
- Vacant possession.
- What is a mortgage?
[edit] External references
- The Leasehold Advisory Service. Service charges and other charges.
- Shelter. Ground rent.
Featured articles and news
The need for a National construction careers campaign
Highlighted by CIOB to cut unemployment, reduce skills gap and deliver on housing and infrastructure ambitions.
AI-Driven automation; reducing time, enhancing compliance
Sustainability; not just compliance but rethinking design, material selection, and the supply chains to support them.
Climate Resilience and Adaptation In the Built Environment
New CIOB Technical Information Sheet by Colin Booth, Professor of Smart and Sustainable Infrastructure.
Turning Enquiries into Profitable Construction Projects
Founder of Develop Coaching and author of Building Your Future; Greg Wilkes shares his insights.
IHBC Signpost: Poetry from concrete
Scotland’s fascinating historic concrete and brutalist architecture with the Engine Shed.
Demonstrating that apprenticeships work for business, people and Scotland’s economy.
Scottish parents prioritise construction and apprenticeships
CIOB data released for Scottish Apprenticeship Week shows construction as top potential career path.
From a Green to a White Paper and the proposal of a General Safety Requirement for construction products.
Creativity, conservation and craft at Barley Studio. Book review.
The challenge as PFI agreements come to an end
How construction deals with inherited assets built under long-term contracts.
Skills plan for engineering and building services
Comprehensive industry report highlights persistent skills challenges across the sector.
Choosing the right design team for a D&B Contract
An architect explains the nature and needs of working within this common procurement route.
Statement from the Interim Chief Construction Advisor
Thouria Istephan; Architect and inquiry panel member outlines ongoing work, priorities and next steps.
The 2025 draft NPPF in brief with indicative responses
Local verses National and suitable verses sustainable: Consultation open for just over one week.
Increased vigilance on VAT Domestic Reverse Charge
HMRC bearing down with increasing force on construction consultant says.
Call for greater recognition of professional standards
Chartered bodies representing more than 1.5 million individuals have written to the UK Government.