Long residential leases

What is a ‘long lease’?

The Trust grants many leases of houses up and down the country. Some of these leases are ‘long leases’ in that they originally lasted for more than 21 years. A lease of a house is different from outright ownership. A lease is a right to live there only for a limited period of time. This article is relevant to you if you’re a long leaseholder or if you’re thinking of buying a long lease from an existing leaseholder of the Trust.

The Trust’s approach may change from time to time so please always check with us before taking major decisions on things dealt with in this article.

Extending your lease

Your lease should set out when it starts and how long it runs for. As time passes long leases inevitably start running out. At some point you may want to extend the lease.

Legal Right to Extend

Your lease may have a legal right for it to be extended. The most common legal right relevant to the long leases of houses owned by the Trust is the right to a 50-year extension under the Leasehold Reform Act 1967. Your lease may qualify under this legislation or may already have been extended under this legislation. So you should always check with your own legal advisor as to whether or not your long lease has a legal right to be extended.

If your legal advisor considers you do have a legal right to an extension and you want to take advantage of such a right then your legal advisor should write to the Trust’s legal team at:

National Trust Legal Department
Heelis
Kemble Drive
Swindon
Wiltshire

SN2 2NA

No Legal Right to Extend

If you’ve no legal right to extend your long lease and you’d like to ask the Trust whether it is willing to voluntarily extend your long lease, then you need to contact the Trust's local estate manager/rural surveyor who deals with your house, via our regional contact details.

The Trust has certain criteria it applies when considering such requests. These criteria, amongst other things, take into account matters such as the specialness of your house in terms of heritage and conservation.

If the Trust agrees (and it may not agree) that your lease can be extended then we will need to agree with you what you should pay for the extension. The estate manager/rural surveyor will outline the process to you.

Rent

Normally, you’ll be paying rent to the Trust – typically on an annual basis. The lease usually sets this out but sometimes other legislation may also be relevant – your own legal advisor will be able to help you here.

Long leases which have been extended under the Leasehold Reform Act 1967 (as mentioned earlier) normally have special provisions regarding rent – these are known as Modern Ground Rent provisions.

Modern Ground Rent

Modern Ground Rent arises when, under the terms of the Act, long leaseholders may have the right to statutorily extend their leases by up to 50 years. This extension is in return for payment of a higher rent known as ‘modern ground rent’. This is likely to be significantly more than the nominal annual amount payable before the extension begins.

The Trust has discovered that some long leaseholders were not aware of the way in which Modern Ground Rents work and had not been properly advised by their solicitors or valuers when they bought their properties.

The Trust has been looking at this issue since it first became aware of how little Modern Ground Rent was understood among many of its long leaseholders. It has been reaching agreements with a number of them in order to lessen the impact of Modern Ground Rent.

However, the Trust has increasingly seen that, in many cases, finding out about the rises in Modern Ground Rent has caused serious concerns for long leaseholders. We approached the Charity Commission which has agreed to our request for an Order enabling us to remove the effect of Modern Ground Rent altogether for most long leaseholders.

In these situations the Modern Ground Rent will be replaced with an index-linked rent based on the current nominal rent.

The Trust is working with individual leaseholders to put this into effect. If you think this scenario is relevant to you then please contact your local Estate Manager for the part of the Trust where your property is situated.

Leasehold and Freehold Reform Bill 2023

The Government introduced the Leasehold and Freehold Reform Bill to Parliament in November 2023. This bill contains provisions which, among other things, could significantly increase the rights which leaseholders of long residential leases (leases for over 21 years) have to extend their leases.

Read the Leasehold and Freehold Reform Bill

Read GOV.UK's Guide to the Leasehold and Freehold Reform Bill

Given that the terms of bills can change as they progress through Parliament, we're currently waiting to see the final form of the new legislation. Until that time, we'll be continuing with our usual practice of considering voluntary lease extensions on a case-by-case basis. If you're considering asking the Trust to extend your lease, we strongly advise you to take independent legal advice as to whether or not it would be beneficial for you to wait until the new legislation comes into effect. This will depend on your specific situation and so it's important you are advised as to what is in your best interests.

Selling your lease

We own many cottages and other buildings but lease them to a tenant, for varying lengths of time and on various terms and conditions.

Most of our leases are for short periods, usually six or 12 months, and are likely to contain provisions stopping the tenant who owns the lease from transferring the lease to another person. However, we do have some leases for longer periods – up to 99 years, which usually have the provision to stop you transferring the lease to another person without our permission.

If you wish to transfer your lease, please contact your local Estate Manager via our regional contact details.