27 Jan 2026
Ground rents paid by leaseholders to be capped at £250 per year
As part of the UK government’s plans to change the leasehold system to help families struggling with unaffordable ground rent costs, the Prime Minister announced this morning (27 January) that ground rents will be capped at £250 per year, reverting to a peppercorn rate after 40 years. He stated that the cost of living is the most significant issue countrywide.
The leasehold reform also included the banning of new leasehold flats, and proposals that homeowners will have more control over how their homes are managed.
There will be over five million leaseholders and new homeowners who will benefit from the Commonhold and Leasehold Reform Bill, gaining more control and protection.
Back in 2022, ground rents were scrapped for most new residential leasehold properties in England and Wales, but remained for existing leasehold homes.
This draft Bill will go to MPs to be scrutinised before moving through to Parliament. The government announced that, subject to parliamentary timings, the rent cap could come into play in late 2028.
Read more on the Government website here.
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