The service charge, or maintenance charge as it is commonly known, is a payment to be made by the leaseholder towards the upkeep, maintenance and repair of the communal areas of the development.
The level of service charge, proportion payable, and the dates payable will usually be defined within the Lease. We are experienced in preparing the service charge budget and long term financial planning to suit the block of flats or estate.
As the land of a leasehold property is owned by the freeholder a ground rent is payable by the leaseholder to the freeholder for the rent of the land upon which the premises occupies for the duration of the term of the Lease.
The level of ground rent will be defined in the Lease, as will the period the ground rent is payable. The level of ground rent is often reviewed throughout the term of the lease and it is not unusual for the ground rent to double at pre-defined times, which are commonly 25 or 33 year periods, throughout the term of the Lease.
A ground rent must exist to form a Lease but the ground rent may be defined as ‘peppercorn’ which is a nominal sum that is often not collected by freeholders.