The Leasehold Reform (Ground Rent) Act 2022 received Royal Assent on 8th February 2022 and formally entered the statute books.
The terms of the draft legislation are to tighten up the risk of unscrupulous landlords exploiting loopholes and finding new ways of getting more money out of tenants (leaseholders).
The government are looking to reduce grounds rents to be charged ‘peppercorn rents’ as they were historically. Anyone breaching the Act can see financial fines of up to £30,000.
Although this is great news for anyone buying a leasehold property, sadly, this will not include existing leases for the moment, but a second bill has been promised in the future to address the problems with current leases.
Timothy Douglas, head of policy and campaign at Propertymark, said: “This legislation is progress and whilst the unsuccessful amendment to remove ground rents from all existing leasehold properties would have strengthened the legislation, it is positive that ground rent charges will now be restricted on newly-created long leases of houses and flats to an annual rent of one peppercorn, a token of no financial value.’’
At Move On, we make sure all our landlords can sleep at night, because this is what we do every day. We make sure we are always up to date with latest legislations, and we are often ahead of the deadline.
If you would like a free rental appraisal and fresh eyes over your paperwork, then please contact me 01202 711169 or email email@example.com