Keir Starmer announced today a limit on ground rents, providing a significant benefit to leaseholders. The Prime Minister shared the news on TikTok, indicating a change that will impact numerous families and address the outdated leasehold system.
Starmer stated, “Great news for homeowners – ground rent will now be capped at £250. This means leaseholders paying more than £250 in ground rent will see reduced costs.” He emphasized the positive impact on individuals, noting that many will save hundreds of pounds, addressing the crucial issue of the rising cost of living.
The government has officially confirmed the annual cap on ground rents at £250, transitioning to a nominal fee after 40 years. Additionally, the ban on new leasehold flats has been announced, signaling the end of the archaic leasehold system rooted in medieval times.
This significant announcement marks the first time a British Prime Minister has utilized TikTok for a major policy declaration. Labour’s manifesto in the previous general election pledged to address unregulated and unaffordable ground rent charges, with former Housing Secretary Angela Rayner urging the government to fulfill this commitment.
While ground rents were eliminated for the majority of new residential leasehold properties in England and Wales in 2022, existing leasehold homes continue to be subject to these charges. Data from the English Housing Survey shows that in 2023/24, leasehold owner-occupiers paid a median annual ground rent of £120.
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