A group of MPs have written to the Government, urging them to introduce a cap on the ground rent that leaseholders pay to freeholders by the end of next year. The MPs claim that current ground rent charges can be as high as £1,000 per year, leaving many leaseholders out of pocket.
The proposal, which would see a maximum ground rent of £250 per year, has been welcomed by leaseholders and freeholders alike. Leasehold reform has been a contentious issue in recent years, with many calling for an end to the practice of charging high ground rents.
According to a report by the Leasehold Knowledge Partnership, there are approximately 4.2 million leasehold properties in England, with many leaseholders facing unfair charges. The partnership claims that the average ground rent for a leasehold property is around £600 per year.
The MPs, who are backed by the Labour Party, say that the cap on ground rent would provide much-needed relief to leaseholders and help to ease the burden of homeownership. They also claim that the move would be a step in the right direction towards leasehold reform.
In related news, the Chancellor, Jeremy Hunt, has announced plans to reform the leasehold system, including introducing a new 'leasehold reform' bill. The bill would aim to give leaseholders the right to extend their leases and reduce ground rent charges.
The Government has yet to respond to the MPs' letter, but a spokesperson for the Ministry of Housing, Communities and Local Government said that they were 'considering' the proposal.