Asked by: Lavona Eugerciosasked in category: General Last Updated: 20th March, 2020
Do you pay ground rent if you have share of freehold?
In respect to this, does share of freehold still have a lease?
Share of freehold Essentially it works by the owners of leasehold flats buying the freehold off the freeholder and then all owning a share of it. Your property will still be owned leasehold but the new freehold organisation can grant new leases of long length, say 999 years, with a peppercorn ground rent.
One may also ask, what does it mean share of freehold? A: Buying a share of freehold means that you will acquire a shared ownership of the freehold title relating to the building, as well as a leasehold interest in the individual flat. Usually the freehold title is registered in the name of a company in which the flat owners will be shareholders.
Considering this, why do I pay ground rent on a freehold property?
In theory, if you own the freehold of a property, it means you own the building and the land it stands on outright, in perpetuity. According to the Money Advice Service, this means you won't pay ground rent, services charges or any other landlord charges.
What is a freehold ground rent investment?
This is an investment profile that fits ground rents where the owner and landlord ultimately has the sanction to take back the freehold of the land if the leaseholder fails to pay their rent. This is a big incentive for the leaseholder to keep paying the very small ground rents and not to default on the lease.