Government opens consultation on service charge reforms

https://consult.communities.gov.uk/leasehold-and-private-rented-sector/strengthening-leaseholder-protections-consultation/

The government state:

The consultation is in two parts. The first focuses on how to implement key measures in the Leasehold and Freehold Reform Act 2024, including:

Making service charge demands more transparent and easier to challenge with new standardised service charge demand forms, annual reports, service charge accounts and administration charges;
Improving transparency around buildings insurance fees, so that leaseholders can better challenge unreasonable insurance charges; and,
Removing barriers for leaseholders to challenge their landlord and scraping the presumption that leaseholders have to pay their landlords’ litigation costs even when they win their case.

The second part looks at going further, with proposals to:
Reform the Section 20 ‘major works’ procedure that leaseholders go through when they face large bills for works;

Make it easier to access this information digitally, while ensuring safeguards for those who need paper access; and,
Introduce mandatory qualifications for managing agents so that all agents have the knowledge and skills they need to provide a good service for leaseholders.

Taken together, the various proposals outlined in the consultation will provide existing leaseholders with far greater rights and protections and will empower them to challenge poor practice and unreasonable charges and fees.

These are just one part of the government’s plans to bring the feudal leasehold system to an end. In the second half of this year, the government also intends to publish an ambitious draft Leasehold and Commonhold Reform Bill which will set out a reformed commonhold model and will consult later this year on a ban on the use of leasehold for new flats.

Some parts of the consultation are technical, but you can respond to as much or as little as you wish.

The consultation will last 12 weeks and closes at the end of September. You can find the link here: https://consult.communities.gov.uk/leasehold-and-private-rented-sector/strengthening-leaseholder-protections-consultation/

Chelsea Bridge Wharf will come back with suggested responses when we have had a chance to digest the proposals but some certainly look promising. A key question is – what will the enforcement action/penalties be for non compliance by managing agents such as Urang or Rendall and Rittner who many leaseholders find to be totally unaccountable?