Bombshell housing revelations are damaging for multiple branches of the Royal Family tree

The National Audit Office’s report on the property arrangements between the Crown Estate and the royals is damaging for multiple branches of the family tree.

The revelations show King Charles’s brothers, nieces and cousin received highly favourable conditions when leasing properties, which in some cases has resulted in HM Treasury earning less income from the agreements than it would have received if fair market value rates were applied.

Firstly, Andrew Mountbatten-Windsor’s agreement for Royal Lodge allowed the former Duke of York to earn a private income from sub-letting three cottages on the land of his Windsor property.

In 2003, the lease was agreed on the basis that he would spend £7.5 million renovating Royal Lodge, which the Crown Estate confirmed he did.

Andrew’s lease for Royal Lodge consisted of the mansion he lived in with his ex-wife Sarah Ferguson, plus eight properties known as the Main Gate Cottages, three of which could be sublet.

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The NAO did not disclose how much Andrew earned from sub-letting these cottages or whether the cottages were continuously occupied, but the report did outline that Andrew’s sub-letting agreement for the cottages ended as late as April 2026.

Andrew Mountbatten-Windsor stepped down as a working royal in November 2019 and was stripped of his prince title in October 2025, but was still able to earn an income from the three cottages while paying a peppercorn rent until just a couple of months ago.

The King’s brother moved out of Royal Lodge in February 2026 and relocated to Marsh Farm after activating an early surrender clause in his lease agreement following newly released documents linking the former Duke of York to convicted sex offender Jeffrey Epstein.

The NAO noted that Andrew’s lease agreement with the Crown Estate was the only one which contained an early surrender clause, which was very fortunate for the Royal Family for two reasons.

The clause allowed King Charles to move Andrew out of Royal Lodge, where scrutiny surrounding his cushy peppercorn rent agreement would have continued. Instead, Andrew is further away from the media spotlight at the King’s Sandringham estate in accommodation funded by the monarch.

The second reason is that the lack of any other early surrender clauses in the remaining lease agreements means it will be much more difficult to get other royals out of their favourable deals.

Andrew’s daughters Princess Beatrice and Princess Eugenie have also come under a fresh wave of scrutiny following the NAO’s findings.

The Royal Households provide residences to working royals at no charge in exchange for official duties. Beatrice and Eugenie are not working members of the Royal Family so are expected to pay rent for the properties they use.

Princess Eugenie lives at Ivy Cottage within Kensington Palace while Princess Beatrice lives in an apartment in St James’s Palace.

However, their rent is paid by King Charles out of his private income. Queen Elizabeth II originally agreed to pay for the princesses’ accommodation, and Charles has taken on this commitment.

The Royal Household's stated policy is generally to charge 60 per cent of open-market rent where security restrictions apply.

The Household charges non-working members of the Royal Family an adjusted rate due to the properties being located within a secure cordoned area, limiting who can reside there, as tenants require security clearance or vetting.

The NAO report found that rates were not always consistent and some valuations had not been updated for several years.

This was the case regarding Eugenie and Beatrice’s rental payments.

Princess Eugenie's rent was 50 per cent of the 2018 market value of Ivy Cottage three years later in 2021.

While the percentage gradually increased over the following four years, the increase was against the 2018 market value rather than a fresh valuation of the property.

Sources close to Princess Eugenie pointed to the royal undertaking refurbishments of the property at her own expense as a mitigating factor.

A very similar scenario took place with Princess Beatrice’s St James’s Palace apartment, with 2020 market value used for the next five years rather than the property being assessed annually.

In 2026, after the Public Accounts Committee announced that it was launching an inquiry into The Crown Estate and Royal Household, new valuations of residences were undertaken, with King Charles now paying 64 per cent and 68 per cent of the updated valuations for Eugenie and Beatrice’s homes.

The lease agreement surrounding Prince Edward’s Bagshot Park has also raised eyebrows.

The Duke of Edinburgh paid a £5 million premium in 2007 when he signed a 150-year lease for the property. He now pays just peppercorn rent on the Crown Estate for the 51-acre royal residence.

Like Andrew Mountbatten-Windsor, Prince Edward was allowed to sublet the stable complex within the grounds of the Surrey property to earn a private income.

Meanwhile, the rental agreement for King Charles’s cousin Prince Michael of Kent has been controversial for over two decades.

In 2002, public backlash erupted when it was revealed the Kents were paying only £69 per week rent for their Kensington Palace apartment.

Queen Elizabeth II later paid a commercial rent of £120,000 annually on their behalf until 2009. King Charles is now funding that rent with his own private income; however, the NAO found no record of a lease agreement before 2026.

The monarch pays 63 per cent of a 2026 fair market valuation of the apartment as rent.

The Prince and Princess of Wales have the most transparent rental agreement for their Forest Lodge property.

In 2025, the future king and queen signed a 20-year lease for the Windsor-based residence, which the couple see as their ‘forever home’.

William and Catherine have agreed to pay £307,200 in rent for the first five years of the lease agreement.

After that, the rental amount will be reviewed and increased between three per cent and five per cent depending on the Consumer Price Index measure of inflation.

The lease can also be transferred to all or any of Prince George, Princess Charlotte and Prince Louis in the future.

Prior to Prince William and Catherine moving into the property, the Crown Estate funded repairs at the mansion.

The renovations totalled £396,993, with £213,000 of the repairs related to Forest Lodge, while the remaining £183,000 related to two cottages used for staff and a barn.

To put the scale of the renovations funded by the Crown Estate into context, they vastly exceeded the average value of a property in England, which stands at around £268,000.

Buckingham Palace expressed gratitude for the National Audit Office report, stating it aligned with the Royal Household's commitment to transparency.

The NAO report shows that the royals have long benefited from favourable terms surrounding lease agreements. Regardless of whether a new spotlight has been shone on this practice, some will continue to reap the rewards of these deals for generations to come.

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