by Sunny Rafaeli, Trainee Solicitor

The Leasehold Reform (Ground Rent) Act 2022  came into force on 30 June 2022 and makes leasehold ownership fairer and more secure for home owners.

Sunny Rafaeli provides a summary of the Act.

Since June 2022, landlords may no longer charge leaseholders ground rent for new, qualifying long residential properties in England and Wales, subject to certain exceptions.

The Act does not apply to: (1) unregulated leases (for the Act to apply, the lease needs to be over 21 years, granted for a premium and have exchanged and completed on or after 30 June 2022); (2) community housing leases; (3) business leases; (4) voluntary or non-statutory lease extensions, which can retain the existing level of ground rent for the unexpired original lease term; (5) statutory lease extensions of houses and flats.

The prohibition on charging ground rent will also apply to retirement housing from 1^st April 2023.

The Act also prohibits landlords from charging administration fees for collecting ground rent.

Landlords who do not comply with the legislation can be fined anywhere between £500 and £30,000.

Enforcement of the Act is the duty of the local weights and measures enforcement authorities.

The Act is the first of a series of reforms and further legislation is due to be implemented by government to level up the playing field.

Use the form below for specific assistance in relation to this Act or any other commercial property matters.