Leasehold Reform (Ground Rent) Act 2022

The Leasehold Reform (Ground Rent) Act 2022 is an Act of Parliament in the United Kingdom that significantly restricts ground rent on new long residential leasehold properties in England and Wales. The primary aim of the Act is to make leasehold ownership fairer and more affordable by removing what is often considered an exploitative and unfair charge.

The key provision of the Act is to reduce ground rent for new leases to a nominal "peppercorn rent," effectively setting it at zero. This means that landlords granting new long leases on residential properties after the Act came into force are prohibited from charging more than a token rent.

The Act does not apply retrospectively to existing leases. Leases granted before the Act's implementation are not affected by the ground rent restrictions. There are also some exceptions to the Act, including certain types of community-led housing and financial ground rents in specific circumstances.

The Act aims to reduce the attractiveness of leasehold tenure for developers and landlords, thereby promoting commonhold as a more desirable alternative. It is a significant step in the wider government agenda to reform leasehold ownership in England and Wales, which may include further legislation in the future. The Act aims to make leasehold properties more marketable, predictable, and affordable for potential homebuyers.