1. What is Ground Rent Increase?

Ground rent increase is the annual adjustment to the ground rent paid by leaseholders, typically calculated using the Retail Price Index (RPI). This adjustment ensures the ground rent keeps pace with inflation.

2. How Does the Calculator Work?

The calculator uses the following formula:

Where:

• \( RPI \) — Retail Price Index (inflation rate as percentage)
• \( Current Ground Rent \) — Current annual ground rent amount

Explanation: The calculation multiplies the current ground rent by the RPI percentage to determine the increase amount.

3. Importance of RPI Calculation

Details: Accurate ground rent increase calculations are crucial for leaseholders to budget for annual costs and for freeholders to maintain appropriate income streams that keep pace with inflation.

4. Using the Calculator

Tips: Enter the RPI percentage (without % sign) and current annual ground rent amount. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is RPI?
A: The Retail Price Index (RPI) is a measure of inflation that tracks changes in the cost of a fixed basket of retail goods and services.

Q2: How often does ground rent increase?
A: Typically every year, but the frequency should be specified in your lease agreement.

Q3: Is RPI the same as CPI?
A: No, RPI (Retail Price Index) and CPI (Consumer Price Index) are different measures of inflation, with RPI generally being higher.

Q4: Can ground rent increases be capped?
A: Some leases include caps on ground rent increases, so always check your specific lease terms.

Q5: What if my lease uses a different index?
A: Some leases may use CPI or other indices - always verify which index your lease specifies for rent increases.