Ground rent disputes - Palmers Solicitors
Ground rent disputes

Ground rent disputes

If your property is leasehold rather than freehold, then although you may own the property itself, you do not own the land on which it is built. This means that you have to pay rent to the owner of the land.

In the past the majority of leaseholds have not caused a particular problem, with many classified as ‘peppercorn rents’ attracting a fee of just a few pounds each year.

However, in recent months a growing scandal has emerged, particularly involving new build properties, where in some circumstances the terms of the lease meant that ground rents increased disproportionately or home owners were unable to make improvements to their property without being penalised.

Recent cases have included:

  • A homeowner being charged £1,500 by the company to make a small alteration to their home
  • A family house that is now unsaleable because the ground rent is expected to hit £10,000 a year by 2060
  • A homeowner who was told buying the lease would cost £2,000 but the bill came to £40,000

Now the Government is cracking down on unfair leasehold practices. It now plans to ban the future sale of houses as leasehold, and is proposing that ground rents will be cut to zero.

Developers are beginning to set up compensation schemes to deal with the problem.

If you are concerned about ground rent charges or other issues relating to your leasehold agreement, help is available from our expert property litigation team.

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