UK residential or commercial property law is amongst the most complex worldwide.

Amongst its lots of instruments is the ground lease.

Ground leases are approved by the freeholder of land and buildings to a leaseholder, typically with a long lease.

This is a semi-permanent arrangement as the lease generally lasts for 125 years or longer and will usually remain in place till the leaseholder decides to end the lease, offer up and vacate.

If the lease goes out, then the land and building( s) are transferred back to the freeholder, unless an extension is granted.

The leaseholder will pay both an in advance payment to the freeholder and ground rent, which is normally paid regular monthly or each year.

The leaseholder normally holds outright control of the residential or commercial property within restricted covenants and easements defined in the lease arrangement.

Ground lease is charged used to the land itself, which remains under freehold ownership throughout the long lease.

Essentially then, commercial residential or commercial property ownership through leasehold involves both an in advance payment in-line with the residential or commercial property's market price in combination with yearly or monthly ground lease.

A Brief History of Ground Leases

Ground leases are an age-old feature of UK residential or commercial property and land law and though they have actually gone through a number of reforms in the Landlord and Tenant Act 1954 and Housing and Urban Development Act 1993, they stay basically comparable to their medieval origins.

Ground leases happened when much of the UK was owned by 'Landed Estates'. Feudal land barons, knights, earls, viscounts and other members of the British aristocracy owned the huge bulk - or all - of the land. The Crown Estate, City of London, Church Commissioners and other major organizations, for instance, still own substantial portions of London consisting of Regent Street and considerable portions of the monetary district. These areas will all go through ground leases.

But, any freeholder of land or residential or commercial property can enter into a leasehold relationship with renters and this is an extremely common type of residential or commercial property ownership.

Ground leasing enables the freeholder to permit development and use on their land without moving ownership of the land completely.

There is substantial leverage in commercial ground leasing investment, where freehold land is acquired and offered on a leasehold basis with payable ground rent, and the present market is blossoming.

There are 3 kinds of generic residential or commercial property ownership and profession in the UK