We have a problem with regard to ground rents. A considerable number of houses were built in the second half of the 19th century and were sold under leasehold reserving a rent of less than £1.
There are frequently perhaps half a dozen houses deriving title from the same lessor, but the economics of collecting rents of this size are such that nothing has been demanded or paid for many years. Very often, the intermediate leasehold interest is unregistered so it is not possible to trace who the rent owner is.
There was a practice in this area of allowing the purchaser six years’ rent, but now some firms are demanding that one should take out insurance against the lessor crawling out of the woodwork and demanding not only rent, but also a fee for restrospective consent in respect of the erection of a back extension. The owner will have obtained planning consent and building regulation consent, but because the identity of the rent owner is completely unknown, no such consent has been obtained.
The cost of insurance seems to be totally disproportionate in these cases. Surely something should be done about these rents in a similar manner to that whereby chief rents are abolished after a ‘magic date’. It would be very welcome if there were to be similar legislation to introduce a shelf-life for ground rents. I appreciate this may not suit the likes of the Westminster estates, but at the very least they should be required to register the fact that the rent is to continue and provide good reason for this.
I cannot imagine anyone registering a desire to continue a rent of £1 or thereabouts. On the expiry of a suitable period, these titles should be converted to freeholds.
R M Napier, Albinson Napier & Co, Warrington