The listing says "ground rent: £350 per annum" in the same grey text as the council tax band, and your solicitor's report on title says it again with a review clause attached. Somewhere in between, someone tells you not to worry because "they've capped it at £250 now".

Here's the plain version. There are three sets of rules, and which one applies to your flat depends almost entirely on the date the lease was granted. New leases since mid-2022 can't carry ground rent at all. Older leases carry whatever they say. And the cap everyone mentions is in a draft Bill that hasn't been introduced to Parliament, let alone passed.

This is England and Wales. Scotland got rid of residential leasehold long ago.

What it actually is

Ground rent is a payment the lease requires you to make to the freeholder, typically once or twice a year, for owning the lease at all.

It isn't payment for anything. No service is delivered in return. The block's insurance, repairs, cleaning and management are paid for through the service charge, which is a separate sum under separate rules. A lease can carry a large ground rent and a small service charge, or the reverse, and the two tell you different things.

It isn't small print. For most of leasehold's history it was nominal and nobody cared. Then leases written between roughly 2005 and 2020 started carrying a few hundred pounds a year with clauses that double it on a fixed cycle. That is where the trouble, the enforcement action and the reform all came from.

The date the lease was granted decides which rules apply. Not the date you buy the flat. A flat changing hands in 2026 on a lease granted in 2014 is on the 2014 rules.

New leases: peppercorn since 30 June 2022

The Leasehold Reform (Ground Rent) Act 2022 came into force on 30 June 2022, and for retirement housing on 1 April 2023.

It applies to what the Act calls a regulated lease: a long lease of a single dwelling, granted for a premium, on or after that date. On a regulated lease the only permitted rent is a peppercorn, which means nothing. Anything above a peppercorn is a prohibited rent. A landlord who demands one can be fined by the local enforcement authority, and section 9 of the Act sets the penalty at not less than £500 and not more than £30,000 per lease.

So on a new-build flat, or any flat whose lease was first granted after that date, the ground rent line should read peppercorn or nil. If it doesn't, that's a question for your conveyancer, not a negotiating point.

A few leases are excepted from the Act, and the exceptions matter more than they look:

Statutory lease extensions under the 1993 Act. These already come with a peppercorn rent under their own legislation, so the 2022 Act doesn't need to cover them.
Business leases, where the lease expressly permits business use.
Community housing leases and home finance plan leases, which are specialist products.

There's also a rule for voluntary extensions. If an existing leaseholder agrees a new, longer lease with the freeholder outside the statutory route, section 6 says the freeholder can keep charging the old rent for what would have been the original term, and only the extended portion drops to a peppercorn. That's a real gap. A "999-year lease" offered informally by a freeholder can still carry the old ground rent for the next hundred years.

Existing leases: whatever the lease says

For a lease granted before 30 June 2022 the 2022 Act does nothing. The ground rent is whatever the lease says, and it increases however the lease says it increases.

The £250 cap is a proposal, not the law, as at September 2026. It sits in the draft Commonhold and Leasehold Reform Bill, published on 27 January 2026. That draft proposes capping ground rent on existing leases at £250 a year, falling to a peppercorn after 40 years. The Housing, Communities and Local Government Committee began pre-legislative scrutiny on 4 February 2026, which is the stage before a Bill is even introduced. Nothing in it can be relied on when you're pricing a flat today.

The earlier Leasehold and Freehold Reform Act 2024, the one that made the headlines, doesn't cap ground rent on existing leases either. Its provisions on lease extensions would take the extension term to 990 years at a peppercorn, but as at today the substitution of the 990-year term into section 56(1) of the 1993 Act is listed among the changes not yet in force. The current statutory extension is still 90 years on top of what's left, and still at a peppercorn, which is the part that actually matters here.

Doubling clauses are the specific thing to look for. Leases from roughly 2005 to 2020 often double the ground rent every 10, 15 or 25 years. Lenders frequently decline to lend on a short doubling cycle, which can leave a flat with 900 years left effectively unsellable to anyone who needs a mortgage. The Competition and Markets Authority ran an investigation into these from 2021 and secured undertakings from Countryside, Taylor Wimpey, Persimmon, Aviva and a run of freeholders who had bought leases from them. The CMA puts the result at over 21,000 households freed from problematic terms. Which means some leases have been fixed and a great many haven't, and the only way to know which yours is, is to read it.

Why the number matters beyond the money

A few hundred pounds a year is not, on its own, why ground rent worries conveyancers. Three other things attach to it.

Lending. Lenders have criteria on ground rent, including how fast it can rise. They vary and change, so they aren't worth quoting here. What's worth knowing is that a lender can decline the flat on the ground rent clause alone, and this happens with leases that otherwise look fine.

Forfeiture. A lease is a contract with a right for the freeholder to end it if you breach it, and non-payment of ground rent is a breach. Two protections in the Commonhold and Leasehold Reform Act 2002 soften that. Under section 166 you're not liable to pay ground rent at all until the landlord serves a written notice, and the notice has to give you between 30 and 60 days to pay. And under section 167, with the 2004 regulations that set the figures, a landlord can't forfeit for an unpaid amount unless it's over £350 or has been outstanding for more than three years. Those are floors, not comfort. A freeholder who wants to make life difficult can still do so above them.

The old assured-tenancy trap has closed. For years, a lease with ground rent above £250 a year, or £1,000 in Greater London, risked being treated as an assured tenancy, which gave the landlord a much easier route to possession for rent arrears. Older guides still warn about this, and until recently they were right. Since 27 December 2025, paragraph 3D of Schedule 1 to the Housing Act 1988, inserted by the Renters' Rights Act 2025, excludes any fixed-term tenancy granted for more than 21 years from being an assured tenancy, whatever the rent. So a long lease with a £400 ground rent is no longer an assured tenancy by accident. That's a genuine improvement, and one a lot of published content hasn't caught up with.

The escape route that exists today

A statutory lease extension. Section 56(1) of the Leasehold Reform, Housing and Urban Development Act 1993 gives a qualifying flat owner a new lease for 90 years on top of the existing term, at a peppercorn rent. The peppercorn is the point. Whatever the current lease says about ground rent, and however it doubles, a statutory extension replaces it with nothing.

It isn't free. The premium you pay the freeholder reflects, among other things, the ground rent income they're losing, so a high or fast-rising rent costs more to extend away. There's no honest way to put a figure on that in an article; a specialist enfranchisement valuer will give you a range for the flat you're actually buying. How the premium behaves, and the 80-year cliff underneath it, is covered in the short leases post.

One thing that has got easier: the two-year ownership requirement before you could serve notice went on 31 January 2025. A buyer can serve on the day they complete.

What to do about it

In this order, and most of it before you agree a price.

Get the ground rent from the lease, not the listing. The particulars will give you a number. The lease gives you the number, the review dates, and the formula. Ask the agent for the lease or the seller's leasehold information pack and read the rent clause yourself.
Establish the date the lease was granted. If it's on or after 30 June 2022 and the rent is anything but a peppercorn, ask your conveyancer why.
Read the review clause in full. "Doubles every 10 years" and "rises with RPI every 25 years" are different problems. Write down what the rent will be at each review over the next 30 years. If you can't work it out from the clause, that's an answer too.
Ask whether the freeholder has ever varied the clause. After the CMA action a lot of leases were converted to fixed or RPI-linked rents by deed of variation. If yours was, there'll be a document, and you want it on the title.
Take the clause to your broker before you take it to your heart. Not "is £350 fine", but "is this clause fine for this lender for this mortgage". Lender criteria are where doubling clauses actually bite.
Price in a statutory extension if the rent is a problem. It removes the ground rent entirely, and the cost of doing it belongs in your offer.
Ignore the £250 cap when deciding what to pay. If it becomes law it's a bonus. If you've paid a price that assumes it and it doesn't, that's your money.

The honest summary

Ground rent on a lease granted since 30 June 2022 is a peppercorn by law, and a landlord who asks for more can be fined up to £30,000. On anything older the lease is the law, and as at September 2026 the £250 cap is a draft Bill in pre-legislative scrutiny, not a rule you can lean on. The clause to fear isn't the number, it's the review mechanism underneath it, and the fix that exists today is a statutory extension to a peppercorn.

Read the rent clause. If nobody in the chain can tell you what the ground rent will be in 2050, the lease can, and it won't be a surprise to the freeholder.

Worth reading next: short leases and the 80-year rule, which covers the extension premium; what a service charge should look like on the same flat; and whether the block needs an EWS1 form.

This is general information, not legal, financial or mortgage advice. Leasehold law in England and Wales is mid-reform and the position described here is as at September 2026. Lender criteria change constantly. Have your conveyancer read the lease and take advice from your broker before making a decision.