Close Menu
Invest Insider News
    Facebook X (Twitter) Instagram
    Wednesday, October 28
    Facebook X (Twitter) Instagram Pinterest Vimeo
    Invest Insider News
    • Home
    • Bitcoin
    • Commodities
    • Finance
    • Investing
    • Property
    • Stock Market
    • Utilities
    Invest Insider News
    Home»Property»Leasehold rent to be capped at £250: what home owners need to know
    Property

    Leasehold rent to be capped at £250: what home owners need to know

    January 28, 20264 Mins Read


    Plans to cap ground rent, end the sale of new leasehold flats and make it easier for existing leaseholders to move to commonhold form part of what the government has described as a ‘game-changing’ shake-up of the leasehold system. 

    These changes build upon efforts to implement the Leasehold and Freehold Reform Act 2024.

    Here, Which? spotlights the key elements of the announcement, why it could benefit the entire property market, and when leaseholders will actually see changes come into effect. 

    This newsletter delivers free money-related content, along with other information about Which? Group products and services. Unsubscribe whenever you want. Your data will be processed in accordance with our privacy notice.

    Ground rent to be capped at £250

    The government has announced plans to cap ground rents – the fee paid by a leaseholder to the freeholder – at £250 a year. After 40 year,s this will then change to a peppercorn cap, which effectively means that very little or no ground rent will be paid.

    Leasehold properties will not be fully outlawed as part of the proposed legislation, but new leasehold flats will be banned.

    The changes have been announced as part of publishing the draft Commonhold and Leasehold Reform Bill, which the government says will ‘fundamentally rewire homeownership across England and Wales’.  

    Leaseholder Action, a group representing leaseholders involved in legal action over concerns about practices in the leasehold sector, welcomed the announcement but said some would be disappointed that ground rents aren’t being eliminated immediately. 

    Liam Spender, the lawyer behind the Leaseholder Action claim, points out that ‘the cap will make it cheaper for people to buy the freehold and to extend their leases, both of which are priced by reference to ground rent values.’

    The Bill would also abolish forfeiture and replace it with a new enforcement regime. At present, leaseholders can ultimately lose their home and the equity they have built up if they default on a debt as low as £350.

    It would also introduce a new process to make it easier for leaseholders to move to commonhold. Under a revamped commonhold model, homeowners would have more control over how their building is managed and the bills they pay.

    • Find out more: Leasehold vs freehold

    EXPLAINER

    What is commonhold?

    Commonhold was first introduced in England in 2002.

    With commonhold, each homeowner within a building owns the freehold to their own property.

    The ‘common’ parts of the building are owned and managed by a commonhold association, made up of homeowners in the building rather than a third-party management company.

    This gives homeowners the ability to control how the building is managed, including the costs of upkeep.

    When will the changes come into effect? 

    Leaseholders may welcome the prospect of lower costs through reduced ground rent, but the reforms are still some way off.

    The proposals form part of the Commonhold and Leasehold Reform Bill, which will now move to pre-legislative scrutiny. This means it could be several years before it receives Royal Assent and becomes law.

    Currently, the government estimates that the ground rent cap could come into force in late 2028, but that is subject to Parliamentary timings.

    Why this could help borrowers

    Mortgage lenders will sometimes carry out additional checks or refuse to lend on leasehold properties with high ground rent, as extortionate fees significantly impact the properties’ value. 

    The government hopes that the introduction of a cap on ground rent will make it easier for potential borrowers to apply for a mortgage on leasehold properties. It will also possibly make it easier for owners of leasehold properties to sell them. 

    This could potentially benefit the entire property market by reducing the number of chains that collapse because of issues surrounding ground rent.

    • Find out more: Best mortgage rates 2026 – updated daily

    New measures to support leaseholders

    Successive governments have promised reforms to the leasehold system. Notably, legislation to ban new-build houses being sold as leasehold became law in 2019.

    In the final days of the Conservative government, the Leasehold and Freehold Reform Act 2024 was passed. Key provisions of the legislation included:

    • Making it easier and cheaper for leaseholders to buy their freehold.
    • Extending standard lease terms to 990 years.
    • Increasing transparency on service charges and requiring freeholders and managing agents to issue standardised bills.
    • Simplifying the process for challenging unreasonable charges at a tribunal.
    • Making it easier and cheaper for leaseholders to take over the management of their building.

    However, only some of these measures are currently in force. Others rely on secondary legislation and are expected to take longer to come into effect.

    • Find out more: Leaseholders to get stronger rights to challenge ‘extortionate service charges’



    Source link

    Share. Facebook Twitter Pinterest LinkedIn Tumblr Email
    Previous ArticleSolid Proff – Sponsored Content
    Next Article Leasehold ground rent to be capped at £250: what home owners need to know

    Related Posts

    Property

    Why China is defying global inflationary tide—and what it means for the world

    October 28, 2026
    Property

    Property Elevator launches on Prime Video

    October 26, 2026
    Property

    China’s Property Slump and Debt Crisis Deepen, Hitting Construction Jobs

    October 26, 2026
    Leave A Reply Cancel Reply

    Top Posts

    How is the UK Commercial Property Market Performing?

    December 31, 2000

    How much are they in different states across the US?

    December 31, 2000

    A Guide To Becoming A Property Developer

    December 31, 2000
    Stay In Touch
    • Facebook
    • YouTube
    • TikTok
    • WhatsApp
    • Twitter
    • Instagram
    Latest Reviews
    Stock Market

    Why DLocal Stock Topped the Market on Tuesday

    September 16, 2025
    Bitcoin

    12-Year Old Dormant Bitcoin Wallet Sends $15M to Kraken Just Before FOMC- What’s Going On?

    July 29, 2025
    Utilities

    Starkville Community Foundation helps residents pay utility bills

    October 18, 2024
    What's Hot

    3 Key Signals to Watch to Predict Bitcoin’s Next Surge

    April 17, 2026

    $15B in bitcoin seized in ‘pig butchering’ bust

    October 14, 2025

    Strategy Bitcoin Sale Fears “Flat Wrong,” Bitwise Says

    December 4, 2025
    Most Popular

    Bitcoin cible 110 000 $ au milieu des entrées hebdomadaires de 1 milliard de dollars

    June 16, 2025

    Kevin Durant Recovers Bitcoin Bought at $650, Now Up Over 17,700%, After Nearly a Decade

    September 20, 2025

    Les principales cryptomonnaies reculent ; le bitcoin tombe sous le niveau de 97 000 dollars -Le 13 février 2025 à 22:00

    February 13, 2025
    Editor's Picks

    ​​Bitcoin price near $90K: ETF inflows, macro uncertainty and key resistance levels

    December 22, 2025

    London stock exchange beats Wall Street with best FTSE 100 year since 2009 | FTSE

    December 31, 2025

    Bitcoin Cash Price Overview for September 6 – InsideBitcoins

    September 6, 2025
    Facebook X (Twitter) Instagram Pinterest Vimeo
    • Get In Touch
    • Privacy Policy
    • Terms and Conditions
    © 2026 Invest Insider News

    Type above and press Enter to search. Press Esc to cancel.