October 8, 2021

Countryside Properties removes doubling ground rent clause

Leasehold solicitors at Holmes & Hills discuss the September 2021 Countryside Properties announcement regarding the removal of doubling ground rent clauses.

Developer, Countryside Properties, has made a voluntary commitment to offer leaseholders owning ‘relevant leases’ a significant change to their lease terms, specifically, the removal of the doubling ground rent clause.

The impact of the change is that the imposed terms of the lease will not increase from the initial ground rent amount applicable at the commencement of the lease term.  

What is a ‘relevant lease’?

Countryside’s announcement is only relevant to leaseholders owning a property with a ‘relevant lease’ - this being a lease that contains a doubling ground rent review clause stipulating a review more frequently than every 20 years. Importantly, ‘relevant leases’ include those leases that originally included a doubling ground rent clause that doubled more frequently than 20 years but which has subsequently been varied by Deed of Variation to replace a doubling calculation with an increase in line with the Retail Price Index (RPI).

As outlined on Countryside Properties’ website, it is believed such ‘relevant leases’ are limited to the following:

  • Some leasehold properties at Queen Mary Place, Liverpool
  • Some leasehold properties at Central Way Speke, Liverpool
  • Some leasehold properties at Stephenson Grove, Rainhill, Prescot
  • Some leasehold properties at Bonham Way, Gravesend, Kent

Freeholds no longer owned by Countryside Properties

It is common for developers of leasehold properties, once construction is complete and all plots sold, to sell the freehold titles to professional freehold companies, these are often owned or linked to large investment and pension funds. This is also what Countryside Properties has done with some of its freehold title properties which are encumbered by leases.

Unfortunately for leaseholders where Countryside no longer owns the freehold but has sold it, Countryside is not in a position to vary the lease (via Deed of Variation) and remove or amend the doubling ground rent clause.

However, Countryside Properties, as part of their commitments made to the Competition and Markets Authority, have agreed to liaise with relevant freeholders who now own freehold properties encumbered by leases with doubling ground rent clauses that were originally built and sold by Countryside Properties. Countryside must offer these freeholders payment in return for making the same or similar commitments to remove or amend doubling ground rent clauses, at no cost to affected leaseholders. It will remain to be seen whether the freeholders will engage with Countryside Properties.

If you own a leasehold property with a doubling ground rent clause which was built by Countryside, but which now has an alternative freehold owner, contact the leasehold law specialists at Holmes & Hills Solicitors for free initial advice and guidance on your options.

Time limits on accepting Countryside’s offer to remove the doubling ground rent

The deal struck between Countryside and the competition and Markets Authority means that leaseholders owning ‘relevant leases’ have just over two years from 13th September 2021 to accept the offer from Countryside Properties. Countryside Properties are only obliged to contact leaseholders on three occasions with the offer, once within 60 days of 13th September 2021 and then annually thereafter, for two years.

Countryside leaseholders wishing to accept Countryside Properties’ offer to remove their doubling ground rent clause at no cost to the leaseholder can contact the specialist leasehold enfranchisement lawyers at Holmes & Hills Solicitors.

Why is Countryside Properties varying leases now?

This announcement from Countryside follows much discussion surrounding leasehold property, leasehold reform, and doubling ground rents. Leasehold, as a form of property ownership, has and continues to receive much scrutiny with new legislation being proposed and alternative forms of property ownership being considered for promotion and encouragement by the Government (commonhold).

More specifically, Countryside’s announcement follows an investigation by the Competition and Markets Authority into clauses featuring in the leases of leasehold properties built and sold by several developers. Holmes & Hills’ team of leasehold enfranchisement solicitors has separately written about announcements regarding Taylor Wimpey’s Ground Rent Review (Leasehold) Assistance Scheme, which saw Taylor Wimpey announce variation of ground rent review clauses.

In 2019 the Competition and Markets Authority commenced its investigation into potential leasehold misselling and the possibility of unfair terms being written into leases and the work of the Authority in this area continues to this day.

The Government is currently debating the Leasehold Reform (Ground Rent) Bill 2021-22 which has completed its House of Lords stages and will now be debated in the House of Commons. Briefly, the Bill aims to make illegal the imposition of ground rents on new leases granted. For more information and detail on the Bill, see our article: Leasehold solicitors’ comment on Leasehold Reform (Ground Rent) Bill 2021.

Do you own a leasehold property with a doubling ground rent clause?

For free initial advice from specialist lease extension solicitors, call 01206 931300.
Or send an email

Key Contact

Callie Tuplin

Senior Solicitor


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