A major change to ground rents is set to come into effect a year earlier than previously announced. Homeowners in England could see their ground rents capped at £250 by late 2027, instead of the originally planned 2028, according to reports from The Times.
Government's Revised Timeline
The Labour Party government had initially promised to cap ground rents at £250 by late 2028, with a transition to a peppercorn cap after 40 years. However, the government is now expected to pledge implementation by late 2027, bringing relief to millions of leaseholders sooner than anticipated.
A Ministry of Housing, Communities and Local Government spokesperson stated: “These measures will save leaseholders thousands of pounds over the course of their leases. Our plan is to implement these reforms by 2028 at the latest. We are currently considering the recommendations made by the Housing, Communities and Local Government Committee, including its recommendation to implement these reforms more quickly.”
Prime Minister's Statement
Prime Minister Keir Starmer previously commented on the policy, saying: “Good news for homeowners, we’re capping ground rent at £250. That means if you are a leaseholder, and your ground rent is more than £250, you’ll be paying less. And I’ve spoken to so many people who say this will make a difference to them of hundreds of pounds. That’s really important because the cost of living is the single most important thing across the country. So this is a promise that we said we’d deliver and I’m really pleased that we’re delivering on that promise.”
Housing Secretary's Remarks
Secretary of State for Housing Steve Reed added: “If you own a flat you can be forced to pay ground rents that can become completely unaffordable. We said we’d be on the side of leaseholders – which is why today we are capping ground rent – helping millions of leaseholders by saving them money and giving them control over their home. The leasehold system has tainted the dream of home ownership for so many. We are taking action where others have failed – strengthening home ownership and calling time on leasehold for good.”
The reform is expected to benefit approximately five million households across England, providing significant financial relief amid ongoing cost-of-living pressures.
