National Trust abandons plan that would have led to huge rent rises for tenants

The introduction of modern ground rents by the charity would have led to rises of up to 15,000 per cent

The National Trust has abandoned plans to introduce rent increases for long-term tenants that in some cases could have resulted in annual rises of more than 15,000 per cent.

Some National Trust tenants are on so-called "modern ground rent" agreements, which allow long leaseholders to legally extend their leases by up to 50 years.

But these extensions are granted in return for the payment of a higher modern ground rent, which the National Trust said was likely to result in a significant increase in the amount payable before the extension of the lease began.

The Leasehold Knowledge Partnership, which is the secretariat of the All-Party Parliamentary Group on Leasehold Reform, said that in one case this led to an increase in annual rent from £50 to £8,000. It added that about 300 leaseholders were affected by the proposed increases.

The LKP said that many of the properties were sold on long leases in the 1970s and 1980s in "states of dilapidation", and leaseholders were told that the 49-year leases could be extended free of charge for another 50 years.

Instead of doing this, the LKP said, the National Trust introduced modern ground rents.

The National Trust said it was working with tenants to reduce the impact of the modern ground rent regulations, and the government was considering reviewing the Leasehold Reform Act, which governs modern ground rent regulations.

The charity has received permission from the Charity Commission to replace modern ground rent with an index-linked rent based on the current nominal rent to help reduce the financial burdens on tenants.

Mark Harold, director of land and nature at the National Trust, said: "We have been listening to the concerns of our long leaseholders and looking to find ways to ease the impact of modern ground rents where we could. However, we have increasingly seen that, in many cases, finding out about the rises in modern ground rent has caused serious concerns for them.

"We appreciate that it has been a difficult time for many of our long leaseholders and we hope that this significant change will help to resolve the situation. We shall now be working with the individual leaseholders to put this into effect."

A Charity Commission spokeswoman said: "We are pleased to have authorised this order, which will allow the National Trust to release leaseholders who were not aware when they acquired their properties of the financial impact of modern ground rent from large rent increases that they might have had difficulty paying."

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