What is the point of doubling rent?
Whole thing about ground rent scandal is actually about very high amount of money leaseholders have to pay to freeholders for annual rent. If I told you that average price of annual rent is from 200 to 400 pounds you would ask me what is problem with that. Is that so much money for one year? Well, that’s not all; the rent is doubling every 10 years. Ten years? So what? Do you know how much time is that? Well, maybe you should do some math. If you pay 200 pounds for rent this year, for 10 years you will pay it 400 pounds, in 2038 you will pay 800, ten years after that you are going to pay 1600 and so on. So that is not so small amount right?
You maybe don’t have problem but your children will
Maybe this numbers don’t sound too much to you, but one of the biggest problems in ground rent scandal is that your children will curse you because you left them paying thousands and thousands pounds because of you. If you calculate precisely they will be in situation to pay about 8000-16000 pounds annually, and their kids will pay even more.
You don’t pay only rent
Because of many clauses you don’t need to pay only for rent, but you are also supposed to pay for many other things. You know that as leaseholder you cannot make any change on the property without permission from freeholder, and guess what – you have to pay for his permission. Prices are different, but for something like building conservatory you need to apart from 3000 to 4000 pounds only for permission from freeholder.