Ground rents could boost housebuilder profits

A GROUND rent management company is warning that many residential developers are failing to take easy profits by collecting or selling the ground rent due from their properties.

Mark Hawthorn of Bolton-based Landmark Investments Group has said that the value of collecting or selling ground rents from properties is “almost all profit”.

According to the company, of the largest 20 developers in the country, whose combined turnover exceeds £19bn, more than two-thirds have year ends due in the next six months.

Legal notices required in selling ground rents take eight weeks to complete, before any contract can be sent.

Mr Hawthorn said: “Considering the market conditions over the last couple of years, ground rent sales could be a welcome and significant addition to profits, especially for housebuilders with large scale apartment developments.

“We are approached all too often by developers who need to sell ground rents quickly for their year-end sales only to have to inform them that it is not legally possible this late in the day.”