Is £250 ground rent increase an issue?

Reply to the comment left by Amethyst at 29/11/2023 - 14:39
Is your lease linked to RPI ?
What items have caused the £87,000 overspend over the last two years ?

Reply to the comment left by Amethyst at 29/11/2023 - 14:39
yours is exactly the type of case that the new law is intended to help with. If none of the other things go through a rent capping order for people like yourself is very likely. In fact I wrote to Mr Gove suggesting exactly that emulating the Rent Capping order of 1999 affecting fair rents so that ground rents do not rise at more than the rate of inflation, but I am pretty sure he will cap them in absolute amount at the least. Are you the original owner or did you purchase an assignment of the lease? The reason I ask is that there may possibly be a negligence claim against your lawyer; how long ago did you acquire

Reply to the comment left by Dylan Morris at 29/11/2023 - 14:47
The overspend is always the same CCTV/ Security/ increased patrols re ASBO / AirBnB type behaviour and mechanical fault with lifts and the door systems. Attempts to get the Management company to see sense about the need for a Concierge to 'elevate' the status of the block fall on deaf ears - too expensive. False economy in my book. Some parts sold off to Social Housing as well. Man Agent knows they will not be challenged for management as no other Agent will take it on when it gets so low. We've had the property from conversion ( old Mill ) and I have seen so many landlords bite the bullet and sell at terrific losses or be evicted under a GR related issue. It rents out like dream but most of us are on the verge of paying the tenant for living there as the numbers don't stack up. Re the GR it's RPI and the sinking fund formula has four complicated possible permutations depending on which is the greater contribution.

Yes.
It can be an issue.
Over £250 pa the AST section 8 ground 8 'can' apply.
The reason it is becoming an issue is that the goverment as usual failed to update anything and it's catching up with the old limit.
Speak to your solicitor.
We are agreeing (as freeholder) to (at leaseholders expense) sign a waiver not to use this ground.
We are keeping the Increase in place.

Having reread the question I note that it says ‘one of my leasehold flats’ has a GR increase. All the flats are subject to terms of the same lease and all would have had notice of an increase. It is not allowable in law to treat one leaseholder different from the others holding the same lease

The government have launched a 36-question consultation into whether they should cap ground rents on existing leases. It runs until 21 December 2023 and will require consideration of the results.
As the ground rent serves little or no purpose, it is sensible to do away with it. In the short term, the freeholder may suffer slightly, and the leaseholder gains somewhat, but in the longer term, it will be one pointless revenue stream for no benefit to the payee that is done away with.

However, it may be an easier route for the government to cap existing ground rents until they expire.

Reply to the comment left by Mr Blueberry at 29/11/2023 - 17:59
the ground rent is as much a term of the lease as the extent of the term of years. Indeed I can remember people negotiating the premium down slightly against a slightly higher ground rent. It cant possibly be right for the Government to legislate for ground rent to cease to be owed without any compensation for no longer having to pay it being paid by the lessee. This is totally improper. I can imagine a statutory scheme for buying out ground rents which ignores ground rent increases which increase at such a high level so as to be onerous. A ground rent is just as valid as a rent paid monthly for a flat or a garage, Gove seems to have got a little bit carried away with himself to publish a bill which is not in any respect even handed.

Doesn’t GR indicate the existence of leasehold ownership with protected tenure with protection under landlord and tenant legislation and property law.
Without the signifier of GR then service charge might be treated as an imposed charge and an Assured shorthold tenancy agreement.

not necessarily, any lease statutorily extended under the 93 act is at a rent of a peppercorn

Yes but the fact of GR whether peppercorn or an amount is a signifier