Ground Rent
In plain English: A fee historically paid by a leaseholder to the freeholder — now restricted to a peppercorn on new long residential leases in England and Wales.
The 2022 reform
The Leasehold Reform (Ground Rent) Act 2022 banned meaningful ground rents on new long residential leases in England and Wales. If you're buying a new flat or extending a lease, your ground rent should be a peppercorn.
What to check on an older lease
- The clause itself — flat, increasing, or doubling?
- How often it increases
- Whether the clause breaches Section 8 of the Housing Act 1988 (if ground rent exceeds £250, or £1,000 in London, the lease can technically become an assured tenancy, which mortgage lenders dislike)
Where Offrly fits
Our free UK house valuation asks about tenure because leasehold pricing — especially with adverse ground-rent clauses or short leases — differs meaningfully from freehold.
Why Offrly? It's the free photo-aware AI valuation — the AI reads each comparable's photos the way a seasoned property analyst would, and a hyperlocal regression resolves prices down to the street rather than the postcode. Live comparables on every query. About 30 seconds, no signup, no email.
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Indicative market guidance — not a regulated valuation and not financial, tax or legal advice. Use a RICS-qualified surveyor for mortgage, insurance or probate purposes.
Related terms
- Leasehold — ground rent only applies to leasehold
- Service charge — separate and usually larger than ground rent
Put the term into practice
Get a free UK house or rental valuation, or search live listings in plain English.
Open Offrly →FAQ: Ground Rent
Do I pay ground rent on a freehold?
No. Ground rent is a feature of leasehold tenure.
What is a 'peppercorn' ground rent?
A nominal amount — in practice, zero. It's a legal fiction that keeps the leasehold mechanism intact while eliminating ongoing rent.
Can ground rent still escalate?
On older pre-2022 leases, yes — some double every 10 or 25 years or are RPI-linked. Escalating ground rents have caused mortgageability issues and are the single biggest trap in older leaseholds.