The Leasehold Reform (Ground Rent) Act 2022
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The Leasehold Reform (Ground Rent) Act 2022 comes into force tomorrow, 30th June 2022, except for in retirement properties, where it will come into force by 1st April 2023.
This means that for new, qualifying, long residential leasehold properties in England and Wales (i.e. leases of more than 21 years of a single house or flat, granted for a premium after 30th June 2022) the ground rent shall become one peppercorn per annum. This means that no money is legally charged or paid in relation to ground rent and freeholders are banned from charging administration fees for collecting a peppercorn rent.
This also means that any lease extension would also be covered by the act, i.e. lease extensions will also need to vary the ground rent to one peppercorn.
The Government has published guidance for consumers and enforcement authorities on the operation of the Act.
Guidance for leaseholders, freeholders and managing agents may be found here: www.gov.uk/government/publications/the-leasehold-reform-ground-rent-act-user-guidance.
Guidance regarding enforcement may be found here: www.gov.uk/government/publications/the-leasehold-reform-ground-rent-act-statutory-guidance.
If you have any further questions in relation to this article, please contact Fiona Bee, Consultant Solicitor, on 0330 175 5655.