Agents have been made aware of the impact on affected properties bought and sold from this date, with only a peppercorn ground rent being legal on new residential leases established after the commencement of the Act. Leases for business premises are not affected.
The new provisions apply where:
They do not apply where:
In addition to ground rents being restricted to a peppercorn for affected properties, the Act also bans landlords from charging a fee related to collecting a peppercorn rent. There is no obligation to actually collect a peppercorn from leaseholders.
Statutory lease extensions for flats must already be granted at a peppercorn, and statutory lease extensions for houses remain unchanged. Enforcement of the new provisions will be by Local Authorities, who can order any prohibited ground rent to be repaid.
Guidance from the UK Government for leaseholders, freeholders and managing agents has been published to accompany the new provisions, and the How to Lease guide has also been updated.
John Hoole Estate Agents in Brighton and Hove - Source: Propertymark 27 June 2022