The ground rent clauses can be complicated and that’s why a lot of people are getting involved in ground rent scandal. One might read the clauses and still fail to comprehend what they mean and that’s why it is always very wise to consult a solicitor before you buy a house on leasehold basis.
For the older leases, the amount to be paid was just small and the amount could not have increased until like 33 years after. But with the leasehold houses that have been constructed nowadays things have changed. There are some leases that have clauses that allows the freeholder to increase the ground rent after a specific amount of time, in most cases it is usually after 10 years. This is all to do with the ground rent scandal.
After this 10 years the clause allows the landlord to double the ground rent meaning if you are paying 400 pounds in 2019, you will be paying 800 pounds in 2029. Clauses like those have made such houses almost impossible to sell on freehold basis.
Many people fail to read and understand this clauses and it is one of the reasons why over 12,000 home owners have been complaining of increased charges that they have no idea where they came from. This clauses are increasing ground rent to absurd levels and if you are not careful enough when you are buying a house you might fall a victim too.
The new leasehold homes developed are also offering the leaseholders even longer time to own the house. Some clauses nowadays are even allowing you to own a house on leasehold terms for up to 999 years. If you read all the terms well and understand, this might actually be a good deal. Involve a solicitor who will explain all the clauses to you and if it sounds like a good deal, you can go ahead and purchase the house on leasehold terms.