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Ground rent, sometimes known as a rentcharge, is a regular payment made by the owner of a Leasehold property to the Freeholder, as required under a Lease. A ground rent is created when a freehold piece of land or a building is sold on a long lease or leases. The ground rent provides an income for the Freeholder.
With Buy to Let properties, the Ground Rent will vary from property to property, however the norm would be between £50 - £300 per year. Usually there are provisions within the lease agreements for staged increases in the Ground Rent, usually every 15 years - this will be from the commencement date of the lease, not when you purchased the property.
Yes – ground rent would be detailed within the leasehold agreement and annual payment (usually in advance) is required. The Freeholder would be able to persue the leaseholder for payment and under extreme conditions could forfit the lease.
Usually in leasehold agreements there are provisions for ground rent reviews, however these are usually every 15 or 20 years.