What is leasehold ground rent and do I have to pay it?

What ground rent is

Ground rent is a regular payment that some leaseholders make to their landlord (the freeholder). Your lease says how much it is and when it is due. It is separate from service charges, which pay for things like repairs and cleaning.

When you have to pay

You do not have to pay ground rent until your landlord sends you a formal, written demand for it.

Other rules to know:

• Back payments: a landlord can claim unpaid ground rent for up to the last 6 years, and can ask for it all at once.
• Increases: your landlord can only put the ground rent up if you agree, or if your lease says it can rise.

The peppercorn rule for new leases

The Leasehold Reform (Ground Rent) Act 2022 stopped ground rent on most new long leases of homes. On these leases the landlord can only ask for a "peppercorn", which is a legal term meaning nothing at all.

The rule only covers new leases granted from those dates. If you buy an older flat after June 2022, you still pay the ground rent written in that lease.

Some leases are not covered, including:

• business leases
• some community-led housing and certain home finance products
• leases where a binding contract was exchanged before the start date

Lease extensions and ground rent

A legal (statutory) lease extension on a flat already comes with a peppercorn ground rent.

If you agree an extension informally with your landlord, the rules are different. The ground rent for the rest of your original lease must not be higher than it was before, and the extra years can only have a peppercorn ground rent.

If you are charged when you should not be

If a landlord takes ground rent that the 2022 Act bans, they must pay it back within 28 days of the payment. Ask your landlord in writing for a refund.

Trading Standards teams enforce the Act, and in England district councils can too. They can fine a landlord between £500 and £30,000.

Disputes about ground rent

You can get free advice from the Leasehold Advisory Service.

If you live in Wales, Scotland or Northern Ireland

The 2022 Act applies in England and Wales, and the Welsh Government has its own guidance on it. This guide does not cover Scotland or Northern Ireland, which have their own property laws.

Related guides

• How do I extend the lease on my flat or house?
• What is shared ownership and how does it work?
• How do I get my title deeds from the Land Registry?
• How can I find out who owns a property?

Where this comes from

• Service charges and other expenses, including ground rent (GOV.UK)
• Leasehold Reform (Ground Rent) Act 2022: guidance for leaseholders, landlords and managing agents (GOV.UK)
• Ground Rent Act guidance for Wales (GOV.WALES)