Property management firms that rip off leaseholders could be banned under Labour
(c) The Guardian Kiran Stacey Political correspondent Wed 24 May 2023 06.00 BS
Property management companies would be banned from operating in England and Wales if they persistently ripped off leaseholders, under plans being considered by Labour. Lisa Nandy, the shadow housing secretary, is looking at proposals to clamp down on the sector, amid complaints from leaseholders about escalating fees and essential maintenance being left undone.
The plans, which have not yet been completed, are under consideration as part of a wider package to overhaul the current leasehold system, including bringing an eventual end to leaseholds altogether.
During a Commons debate on Tuesday, Nandy called the practices of some property managing agents “a scandal hiding in plain sight”. Her backbench colleague Emma Hardy added: “There is no one regulating these companies. They’re accountable to no one – even members of parliament find it very difficult to hold them to account for their bad practice.”
About 10 million Britons own their homes through leasehold, and face having to pay extra charges for ground rent, service fees and leasehold extensions.
Michael Gove has promised to end what he called the “feudal” leasehold system, but the Guardian revealed earlier this month those plans had been watered down after Downing Street decided they would be too difficult to enact before the next election.
Ministers said on Tuesday they intended to cap ground rents and ban property owners from charging leaseholders extortionate fees to fulfil simple requests.
Labour said it would enact a “phased” end to the system if elected next year, including a ban on new developments being sold as leaseholds, scrapping any issued after 2017 and eliminating more historical versions in the longer term.
In the meantime, the party also plans to clamp down on the service companies that maintain properties on behalf of owners.
Labour sources told the Guardian the party was looking at a system that would mirror the licensing regimes it had already promised for landlords and agents in the rented sector.
Shadow ministers are scrutinising the proposals made by Lord Best, who was commissioned by the government in 2018 to come up with a new regulatory system for property management companies.skip past newsletter promotion
Property management companies would be banned from operating in England and Wales if they persistently ripped off leaseholders, under plans being considered by Labour.
Lisa Nandy, the shadow housing secretary, is looking at proposals to clamp down on the sector, amid complaints from leaseholders about escalating fees and essential maintenance being left undone.
The plans, which have not yet been completed, are under consideration as part of a wider package to overhaul the current leasehold system, including bringing an eventual end to leaseholds altogether.
During a Commons debate on Tuesday, Nandy called the practices of some property managing agents “a scandal hiding in plain sight”. Her backbench colleague Emma Hardy added: “There is no one regulating these companies. They’re accountable to no one – even members of parliament find it very difficult to hold them to account for their bad practice.”
About 10 million Britons own their homes through leasehold, and face having to pay extra charges for ground rent, service fees and leasehold extensions.
Michael Gove has promised to end what he called the “feudal” leasehold system, but the Guardian revealed earlier this month those plans had been watered down after Downing Street decided they would be too difficult to enact before the next election.
Ministers said on Tuesday they intended to cap ground rents and ban property owners from charging leaseholders extortionate fees to fulfil simple requests.
Labour said it would enact a “phased” end to the system if elected next year, including a ban on new developments being sold as leaseholds, scrapping any issued after 2017 and eliminating more historical versions in the longer term.
Labour really going for the ripped off leaseholder vote. Just hope they make good on the promise and don’t water it down under pressure from developers and agents, as Gove/Tories predictably did
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Residents’ Associations also need regulation. We should not have a situation where RA’s can be taken over by an unelected few who refuse to consult with residents, hold no elections/dodgy elections and in effect hold the residents as digital captives via an online platform or app, where they can act like the government of a totalitarian regime and close the account of any dissenters. A residents’ association which lacks transparency and good practice can hardly be expected to hold a dodgy managing agent to account. Large sums of resident money are being collected and residents may have little idea how it is being used.
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I hope we can soon get rid of R&R, the worst management company. They have unbelievably high service charges and provide horrible service. They have made so many mistakes regarding building management that we can definitely sue them.
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In case you did not see my piece on this
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Yes I hope so too. But to appoint another agent without any resident input and without having done enough checking on them will be a huge mistake. CBWRA have pretty much decided to appoint Urang and there is no meaningful consultation with residents. The process by which Urang were ”chosen” by the unelected committee of CBWRA is far from clear and I do not think they are the best option. CBWRA hope that most residents will not look into this too much and just trust their recommendation but I think that could just mean ‘frying pan to fire’ situation.
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