The Leasehold Reform (Ground Rent) Act 2022 (in force from 27 June 2022) is a landmark reform of residential leasehold. It prohibits landlords and freeholders from charging ground rent on new 'regulated leases' — long residential leases (over 21 years) granted on or after the commencement date. The only permitted ground rent is a peppercorn — effectively zero.
Charging a prohibited ground rent on a new regulated lease is a civil offence carrying a penalty of between £500 and £5,000 per breach. Each demand or collection is a separate breach. Enforcement is by local authority Trading Standards.
Which leases are regulated
- New residential long leases (term exceeding 21 years) granted on or after 27 June 2022
- Retirement housing leases: commencement date was 1 April 2023
- Statutory lease extensions under the Leasehold Reform Act 1967 or 1993 Act: must be at peppercorn for the extended term
- Voluntary lease extensions granted after 27 June 2022: must be peppercorn if constituting a new lease over 21 years
- Not regulated: business leases, agricultural tenancies, assured tenancies (monthly rentals), community housing, and leases granted pursuant to pre-commencement contracts (transitional protection)
What is prohibited
- Any ground rent above zero (including £1/year, index-linked amounts, or any nominal sum)
- Any rent review clause that allows future increase — even if the starting rent is peppercorn
- Disguised ground rent through non-genuine service or administration charges
Leasehold and Freehold Reform Act 2024
The 2024 Act enacted further reforms: service charge transparency requirements, restrictions on building insurance commission, Right to Manage extensions, and changes to enfranchisement premium calculations (broadly reducing the premium leaseholders pay). Not all provisions were in force as of June 2026 — monitor commencement orders from MHCLG.