With leaseholders paying on average 42% more than the published management fees, a simple change to legislation requiring the landlord to disclose extra details on commissions, contractors and insurance policies could make a huge difference. This is why Urban Owners has once again written to MPs and the Government calling for a change to the law.
A response from Communites and Local Government (CLG) to previous lobbying activity rejected the need for such a change, but a discussion in the House of Lords has since been tabled to debate the issue. There are approximately 1.8 million leasehold properties in the UK and it is hoped that the report’s new evidence of property management abuses will prompt further action by the Government.
Urban Owners believes Section 21 of the Landlord and Tenant Act 1985 could easily be amended, forcing managing agents or freeholders to add a note to the annual service charge accounts, disclosing:
i. commissions taken
ii. details of work contracted out to companies within the same holding group
iii. the date on which the block’s insurance policy was last market tested
Such a simple alteration to an existing law would create transparency over managing agent fees and giver leaseholders a greater say over their own payments.
Steve Wylie, Director at Urban Owners, comments:
“Almost 2 million households are held under a lease and all too often the experience of leasehold ownership is frustrated by being overcharged or kept waiting for simple repairs and services, with many leaseholders unaware that they are paying significantly more than they need to.
“Which? Money’s decision to champion the issue for its subscribers, many of whom have written to highlight the problem is a significant leap forward for campaign to improve the property management sector and we hope that the report will increase awareness. We have written to MPs for a second time to prompt a further discussion of leasehold legislation in Parliament and look forward to the response.”
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