Legal background
- The main legislation relevant to the rights of residential leaseholders is:
- the Leasehold Reform Act 1967;
- the Landlord and Tenant Act 1987;
- Schedule 2 of the Housing Act 1988;
- the Local Government and Housing Act 1989;
- the Leasehold Reform, Housing and Urban Development Act 1993;
- the Commonhold and Leasehold Reform Act 2002.
Ground rents
- The Commonhold and Leasehold Reform Act 2002 requires landlords to serve written notice before ground rent becomes payable and prevents landlords from starting forfeiture action unless they have issued a written notice and the ground rent arrears exceed a specified sum or have been in arrears for more than a specified period.
Lease extensions
- For qualifying tenants of a long lease of a house, the Leasehold Reform Act 1967 sets out the right to the grant of a new lease for the remainder of the existing term plus a further 50 years, commonly referred to as a lease extension. No premium is payable, but the new lease can contain a modern ground rent, reviewable after 25 years.
- For qualifying tenants of flats, the Leasehold Reform, Housing and Urban Development Act 1993 sets out the right to a new lease for the remainder of the existing term plus a further 90 years, commonly referred to as a lease extension. A premium is payable, but the new lease must contain a peppercorn ground rent.
Security of tenure
- Section 186 and Schedule 10 of the Local Government and Housing Act 1989 provides security of tenure for long residential leases with low rent. Under that Act, when a long lease comes to an end, the tenant is likely to qualify for an assured tenancy which is afforded further protection under the Housing Act 1988.
