999 Year Lease Increase clause

jameslindley

Hi All,

We have an offer in on a house which is leasehold. The land it sits on is owned by a freeholder. It was build in around 1860 or so, and includes an annual £14 "peppercorn" ground rent. There is quite a lot left on the lease, so that is not my main worry. But is there anyway that the free holder could increase the ground rent?

The lease is in the HIp Pack, but it is the original and in oldish english as well as using old legal terms.

Does anyone know if these type of leases have rent increase clauses?

Any help much appreciated.

Thanks

James

Doozergirl

If it does, it will be in that lease.

The only way to increase the ground rent from what is currently dictated by the lease is if you were to negotiate a new lease, which you won't be doing unless you're planning to live as long as Moses and need an extension.

jessbob

Hi

Who is the freeholder on the Lease (the Landlord or Lessor it will state).

some of the old Leases do have clauses for increase in ground rent, but not that many from my experience.

You must ask your solicitor to check the Lease and report to you on any such clauses.

Otherwise, just get a jar of peppercorns ready !

cattie

When leases are all granted with a peppercorn rent, it means that they will always be no more than a token payment. Although Peppercorn ground rent may go up, depending on terms of lease, it will never go up by very much.

You'd need to read the lease to be sure of when rises may occur & by how much. I've owned a few leasehold properties & one of those was peppercorn with a fixed charge of £25 per annum for the duration of a 125yr lease.

Sometimes with leasehold properties ground rent is fixed at a particular amount for say the first 50yrs of lease, then small increases every 25yrs thereafter. But as I say, the lease will set out the terms & if you don't understand it, a solicitor certainly will.

jameslindley

Wow those were some quick responses, thanks too all. I will have to bite the bullet and instruct a solicitor, I didnt want to have to pay out for fees just to be told that the rent could go up by X%.

Thanks again

James

Fire_Fox

You don't need a solicitor right away, just speak to the LEASE advisory service and/ or read their website. http://www.lease-advice.org/

devon007

I very much doubt in a Lease of that age there would be ground rent increases but am dubious about the wording. Leases that had peppercorn ground rents are just that - there has to be an annual rental for a Lease and a peppercorn was considered the smallest thing that could legally pass hands, in other words both parties acknowledge that something is due but unlikely to ever be demanded or paid due to the almost valueless worth of the item. A £14 ground rent is a different thing - it is not a peppercorn rent! The increasing of ground rents by stages (usually 25 or 50 year increments on residential leases) really only started in the latter decades of the last century. Most Leases I have seen pre-70's are set amounts regardless of the length of the Lease
BUT you really do need good advice on it - you should not just be concerned about the ground - you should be concerned about the obligations on you as Lessee, the maintenance and service charge arrangements under the Lease etc. I know these won't be much of an issue on a house as opposed to a flat - but you still need to check them out for anything onerous. Sometimes Leases from the 1800's don't have everything a Lender in this century requires! Again, this probably won't be too much of a problem with a house.
I would guess your house is in the NW or Bristol area? These are the main "pockets" in the UK where you find leasehold houses of that age. There are actually not that many older leasehold houses elsewhere.

cattie

devon007 wrote: »

I would guess your house is in the NW or Bristol area? These are the main "pockets" in the UK where you find leasehold houses of that age. There are actually not that many older leasehold houses elsewhere.

There are actually a lot of these kind of houses on the SE London/Kent border. Vast tracts of farmland were bought by a wealthy landowner & were developed during the Victorian & Edwardian period into family houses with leases of 999yrs at peppercorn ground rents.

Richard_Webster

cattie wrote: »

There are actually a lot of these kind of houses on the SE London/Kent border. Vast tracts of farmland were bought by a wealthy landowner & were developed during the Victorian & Edwardian period into family houses with leases of 999yrs at peppercorn ground rents.

And in the Southampton/Eastleigh area and of course in Yorkshire industrial towns/ cities like Sheffiedl/Huddersfield.