Ground rent in Baltimore: what buyers and owners should know
Many Baltimore homes come with ground rent: you own the house, but someone else owns the land under it. Here's how to check a property, what you'll pay, what happens if it isn't paid, and how to buy it out for good.
By Mike Fielder, Realtor · Updated November 2026
What ground rent is
Under a ground lease, you own the house, and a ground lease holder owns the land it sits on. You pay the holder a yearly rent, and the lease typically runs 99 years and renews. Most ground rents are in Baltimore City, but they turn up in Baltimore County too, Towson included.
Ground rent isn't a property tax. Your taxes go to the city or county; ground rent goes to a private holder, and it's a separate bill.
How to check a property
- Look it up on SDAT. Search the address on the state's SDAT Real Property Search and open the ground rent link on the property record. Ground leases have to be registered there.
- Check the listing. MLS listings show the ownership type: "Fee Simple" means no ground rent; "Ground Rent" means there is one.
- Let the title search confirm it. Before closing, the title company finds the ground lease in the land records and lists it in your title commitment. More on that in title insurance in Maryland, explained.
Registration matters. A holder who hasn't registered the ground rent with SDAT can't collect rent, late fees, or collection costs, and can't sue to enforce the lease. If someone demands ground rent on a property with nothing registered, treat it with suspicion. SDAT has an affidavit process for exactly that.
Buying it out: redemption
In most cases you can buy the land under your house, which is called redeeming the ground rent. Unless the lease sets a lower price, Maryland law sets it: the yearly rent divided by a rate that depends on when the lease was created.
| Lease created | Rate | $120 a year redeems for |
|---|---|---|
| After July 1, 1982 | 12% | $1,000 |
| April 6, 1888 to July 1, 1982 | 6% | $2,000 |
| April 8, 1884 to April 5, 1888 | 4% | $3,000 |
| Before April 9, 1884 | Negotiable, and may not be redeemable | |
Add legal, recording, and title costs on top of the redemption price. Ground rent bills have to include a redemption notice, and your lender has to tell you about your right to redeem when you finance or refinance.
If the holder can't be found, or hasn't been in touch for three years, SDAT has a process to redeem the ground rent without them. For income-eligible owners, the Maryland Department of Housing and Community Development runs a Ground Rent Redemption Loan Program to help cover the cost.
Is it worth redeeming? Often it's a one-time cost of a few thousand dollars or less, and it ends a bill you'd otherwise track forever. Some buyers redeem at closing; others keep paying and decide later. I run the numbers with you before you write an offer.
Two ground rent surprises from my deals
A $350 ground rent in Towson
Ground rent isn't only a City thing, and it isn't always small. I've seen one over $350 a year on a home in Towson, and I'm sure there are higher ones out there.
At $350 a year, redeeming costs about $2,917 if the lease was created after July 1, 1982, or about $5,833 if it's older, plus legal and recording costs. That's manageable, but it belongs in your offer math, not in a surprise at the settlement table.
Before you write an offer, ask for the yearly amount and the lease date so you can figure the buyout price.
A lender that wouldn't fund without a buyout
I've been part of deals where the buyer's lender wasn't used to Maryland ground rent and required it to be redeemed at closing, or it wouldn't fund the loan. Ground rent is legal and common here, and many lenders finance these homes as they are, but a lender that doesn't know the local market may treat it as a problem.
If you're financing, tell your lender up front that the home has ground rent and ask whether they'll require it to be redeemed. If they will, build the cost into your numbers and settle who pays it in the contract. Redemption also takes the holder's cooperation, and a slow or missing holder adds time, so find out on day one, not the week of closing.
If ground rent goes unpaid
- The holder can place a lien on the property and foreclose on it, much like a mortgage, after sending the required notices.
- Back rent is capped at three years, and the fees and costs a holder can recover are limited by law.
- You keep your equity. The old rule that let holders take a home outright for unpaid rent was repealed in 2007.
- If you can't reach the holder, ask your mortgage company about escrowing the ground rent in case the holder turns up.
The simple fix: pay it on time, or redeem it.
Buying a home with ground rent
- Check SDAT and the listing before you write an offer.
- Ask for the yearly amount, the holder's name, and the lease date, so you can figure the redemption price.
- If you're financing, ask your lender early whether it will lend on the home with the ground rent in place.
- Decide whether to redeem at closing or keep paying, and budget for it either way.
- At settlement, ground rent is prorated: the seller pays through the closing date, and you pay from then on.
- Your title company confirms the ground lease, the holder, and the registration.
Ground rent shouldn't scare you off a house. It's a small, known cost with a set buyout price. Shopping in the City? Start with North Baltimore homes for sale, or read how buying a home works with me.
Questions people ask
What is ground rent in Baltimore?
A long-term lease on the land under a house. You own the house, a ground lease holder owns the land, and you pay that holder a small rent, usually once or twice a year.
How do I know if a house has ground rent?
Look up the address on SDAT's Real Property Search and open the ground rent link on the property record. MLS listings also show Fee Simple or Ground Rent, and the title search confirms it before closing.
How much does it cost to redeem ground rent in Maryland?
Unless the lease sets a lower price, the yearly rent divided by 12% for leases created after July 1, 1982, or by 6% for most older leases. A $120 yearly rent on a 1950s lease redeems for about $2,000, plus legal and recording costs.
Can I lose my house for not paying ground rent?
Unpaid ground rent can become a lien the holder can foreclose on, but back rent is capped at three years, fees are limited, and your equity is protected. Pay it or redeem it rather than letting it build up.
Will my lender make me redeem the ground rent?
Not always. Many lenders finance homes with ground rent as they are, but some, especially lenders that rarely work in Maryland, require it to be redeemed at closing. Ask your lender early so the cost and timing don't surprise you.
What if nobody is collecting the ground rent?
An unregistered holder can't collect rent or sue to enforce the lease. If the holder can't be found or hasn't been in touch for three years, SDAT has a process to redeem the ground rent without them.
Is ground rent the same as property tax?
No. Property tax goes to the city or county. Ground rent goes to a private ground lease holder.
General information, not legal advice. For your property, ask your title company or a Maryland real estate attorney. Sources: Maryland Real Property Article, Title 8, Subtitle 8 (residential ground leases); the Maryland People's Law Library guide to understanding ground rent; and SDAT.
Looking at a home with ground rent?
I'll check the registration, figure the redemption price, and help you decide whether to buy it out at closing. Selling one? See how I sell homes.
Talk with MikeCall 410-905-6678