In English land law, it is not rare that real estate is let on a lease for extremely long periods, such as 999 years, with only a nominal land rent. Of course, for all practical purposes a lease of this duration is equivalent to a freehold (unrestricted ownership), but a lease is often preferred because it makes it possible to attach covenants about what can or cannot be done on the land.
This makes me wonder: We’re only a few decades away from the thousandth anniversary of the Norman Conquest, when (I suppose) all of English land holdings began. So are there any cases coming up where, at some point in the middle ages, someone leased land for 999 years, it has been treated as ownership ever since, and people are now realising that it will expire soon?
Don’t need answer fast. I’m just curious whether there are such cases, preferably spectacular ones, with God knows what ghastly consequences in terms of the buildings that have since been built on the land, and difficulties in identifying the owner to whom title will revert.
This is an interesting question, but it may be impossible to answer. Land ownership in England has changed significantly over the past thousand years. Especially after the Conquest, where the monarchy claimed all land and then distributed it by a feudal system, not by leases.
The Leasehold Reform Act, coming in the next Parliament will:
Future legislation will:
Reform the process of enfranchisement valuation used to calculate the cost of extending a lease or buying the freehold.
Abolish marriage value.
Cap the treatment of ground rents at 0.1% of the freehold value and prescribe rates for the calculations at market value. An online calculator will simplify and standardise the process of enfranchisement.
Keep existing discounts for improvements made by leaseholders and security of tenure.
Retain the separate valuation methodology for low-value properties known as “section 9(1)”.
Give leaseholders of flats and houses the same right to extend their lease agreements “as often as they wish, at zero ground rent, for a term of 990 years”.
Allow for redevelopment breaks during the last 12 months of the original lease, or the last five years of each period of 90 years of the extension to continue, “subject to existing safeguards and compensation”.
Enable leaseholders, where they already have a long lease, to buy out the ground rent without having to extend the lease term.
No, but leases of more than 99 years were pretty much unknown before the sixteenth century (when various legal changes made long leases much more secure), so any 999-year leases won’t be expiring any time soon.
You might think the oldest lease would be expiring soonest..
but no…
So, what is the longest lease in existence?
That honour goes to Guinness (Beer company) . In 1759, at the age of 34, Arthur Guinness signed a 9,000-year lease for the St James’s Gate Brewery, Dublin, at an annual rent of £45.
That’s already the case for blocks of flats - if enough of the leaseholders combine to form a company to buy and hold the freehold. I’m a leaseholder and also a shareholder in our freehold company.
Not quite. The “New Territories” of Hong Kong were leased for 99 years, so reverted to China in 1997 anyway; Hong Kong island itself had been ceded permanently (rather than leased) much earlier but it was clear that the UK couldn’t hang on to it separately, whatever the nominal legalities.
I think the point is not the lease of Hong Kong by Britain from China, but the fact that all land in Hong Kong is let by the government to private investors as a lease. Ground rent is a major source of income for the HK government.
Not England, but here’s folks arguing over the rent on a 99-year lease established in 1965.
Apparently these are popular in British Columbia for native land - usually negotiated by the government agents without much input from the owners, back then - hence the animosity.
Many of the houses in the town where I live (English Midlands) were built by a development corporation as part of a designated “New Town”.
Some more recent additions (80s & 90s) were sold as leaseholds with the Corporation being the land owner. In the Noughties, all of this land was sold off. The leaseholders were given first refusal and I recall the price of the freehold being around £1000. There are about 200 houses on this site.
Many leasees chose not to buy. Presumably, they assumed that the ground rent would remain at £Not much indefinitely. The company that bought the unsold leases promptly increased the ground rent tenfold. There was a court case eventually and AFAIK most of those houses are now freehold.
There was another anomaly on that estate, where a gap had been left to allow access to a site for future building. The householders on either side fenced it in and added it to their own gardens. Twelve years later, they had established squatter’s rights and the original owners were offering them large sums to get the land back. The land is still undeveloped.