Ground rent / freehold property Q.

simonineaston

Hi folks, I have my inner-city terraced house on the market to sell. The title held with the Land Registry shows I am the freeholder. I own it outright - there is no lender. Is there any circumstance where I, or a future owner, could be charged ground rent? My understanding is that the freeholder owns the ground on which the property is situated by definition, but it'll do no harm to ask you guys...

armchaireconomist

Unless you've plans to sell the freehold, no.

eddddy

'Ground rent' only applies to leasehold property.

However, a freehold property could have an annual 'rentcharge'...

Or there could be a 'positive covenant' that requires the freeholder to pay a fee for something (perhaps each year) - e.g. for maintaining a communal area.

However, these can't be randomly introduced - they would have been stated in your deeds when you bought the property, and your solicitor should have made you aware.

simonineaston

I quote from the Land Registry title summary, The land in this title is subject to a perpetual yearly rentcharge of £3 5s 0d created by a Grant of the land in this title dated 6 March 1924... This is the first I've heard of any such concept and I've lived there since 2001. Do you think I should take further steps?

davidmcn

simonineaston wrote: »

Do you think I should take further steps?

Keep back £3.25 a year in case someone knocks on the door asking for it?

Seriously, you don't need to do anything.

simonineaston

I'm getting somewhere on this one - apparently there's a concept peculiar to Bristol / Manchester called a rentcharge (one word) which was an arrangement common early in the last century to facilitate house building. I'm told my conveyancer should be able to take it in her stride... although a neighbour selling his house claims that it's scared off at least one potential buyer - they may be getting mixed up with the scare stories on the subject of ground rent and leasehold properties.

G_M

Not just Bristol / Manchester - My mother's house was liable to a similar rent charge in North London.

Like you, she'd never been billed for it or paid it, and (so far as I know) did not know about it.

After her death we sold the property. At one point the buyer's solicitor asked us to pay £150 for an indemnity policy (in case a demand shoud suddenly be made for payment after the sale).

I instructed our solicitor to write back that
a) only 7 years back-dated charges could be claimed
b) these would come to (£22.75 in your case)
c) it was never going to be claimed
d) if it was claimed, and they couldn't afford, or resented paying, £22.75, they should probably not commit to buying a £X00,000 property!

I never heard any more.