Author Topic: Ground Rent review clause  (Read 7857 times)

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Offline Fizz

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Re: Ground Rent review clause
« Reply #50 on: May 13, 2019, 07:11:30 PM »
EM never replied to my letters disputing the increase, not sure what more I can do.

Offline Christopher Newport

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Re: Ground Rent review clause
« Reply #51 on: May 15, 2019, 07:29:04 PM »
I would think the best solution is to get together as a large group of residents. Seeking to challenge increases solo or in pairs versus a large organisation has limited negotiating power.

For those balking at near term legal costs, consider the cumulative cost of increased ground rent levels p.a. going forward.  Then the impact when future increases are applied to the new higher level.  And the potential impact on property valuations.

https://www.which.co.uk/consumer-rights/advice/whats-the-problem-with-doubling-ground-rent-clauses-in-leaseholds#can-the-cost-of-ground-rent-increase

Offline Fizz

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Re: Ground Rent review clause
« Reply #52 on: July 30, 2019, 10:19:48 PM »
Has anyone made any progress on this?

I've been offered a slightly reduced rate linked to RPI going forwards.  Obviously RPI is an unacceptable inflation index but if it was CPI I might be inclined to accept.

Offline Fizz

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Re: Ground Rent review clause
« Reply #53 on: March 02, 2020, 09:13:06 PM »
Good news today with the results of the CMA investigation published

"Ground rents that double more frequently than every 20 years, and
escalating ground rents that raise the prospect of a lease becoming an
assured tenancy with the leaseholder consequently enjoying diminished
security of tenure are likely to have the worst consequences for
consumers. We also have significant reservations about RPI based
increases to ground rent. Moreover, lease provisions imposing ground
rent and providing for its escalation can be obscure and hard to
understand.
5. We estimate that the total number of new-build long leasehold homes sold
between 2000 and 2018 is approximately 778,000. On a conservative
approach we think the total number of leases with ground rents that
double more frequently than every 20 years is approximately 13,000, of
which there are around 10,000 which double every 10 years. There are at
least 57,000 homes where levels of ground rent are already over the
threshold for an assured tenancy.
6. The most comprehensive way to tackle problems in ground rent is through
legislation, and we support the government’s proposal effectively to
abolish ground rent in most future leases. However while this will prevent
problems arising in future it will not alleviate existing problems. The CMA
is preparing to take enforcement action to address the difficulties faced by
homeowners from high and increasing ground rents."
https://assets.publishing.service.gov.uk/media/5e57e4ea86650c53b74fe6e0/Leasehold_update_report_pdf_-.-._.pdf

Offline settler

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Re: Ground Rent review clause
« Reply #54 on: March 24, 2020, 11:29:21 AM »
Has anyone had an mortgage application turned down because of the rent review clause? We are trying to get E&M to amend the in line with property price escalation clause due to the issues around it, but E&M are saying the clause is not onerous and want proof of mortgages turned down because of the clause. It seems ridiculous to pay fees to apply for a mortgage knowing it will be turned down to get this proof for E&M. If anyone does have a refusal letter, would be helpful if they can post a redacted copy of the refusal. Thanks

Fizz, do you make any further progress with E&M?

Offline Fizz

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Re: Ground Rent review clause
« Reply #55 on: March 25, 2020, 12:56:15 PM »
I wasn't able to make any more progress with them.  They just made sure the rent wasn't doubling and did offer RPI linking going forwards.  I rejected that at the time given the CMA investigation was in process so just have the step up rate set slightly below 2.

Offline Fizz

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Re: Ground Rent review clause
« Reply #56 on: September 04, 2020, 01:10:30 PM »
The latest CMA announcement is probably good news for us
https://www.gov.uk/government/news/leasehold-homes-cma-launches-enforcement-action

Offline 586

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Re: Ground Rent review clause
« Reply #57 on: September 14, 2020, 01:06:00 PM »
We negotiated lower than the proposed figure by the freeholder for Susan Constant, but couldn't push further as we didn't have the numbers in terms of leaseholder support.

I'd be interested in what you manage to agree as it could have positive impact to the remaining blocks if the freeholder is applying disparate rates across the estate.

Online Peter De La Mare

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