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Leasehold: Service Charges

Question for Department for Levelling Up, Housing and Communities

UIN 98445, tabled on 5 January 2022

To ask the Secretary of State for Levelling Up, Housing and Communities, if he will make it his policy to bring forward legislative proposals to protect leaseholders from excessive commission charges levied by (a) managing agents and (b) freeholders, when providing (i) buildings insurance policies, (ii) communal energy agreements and (iii) other services contracted from third party suppliers.

Answered on

14 January 2022

The Government is committed to ensuring that those living in the leasehold sector are protected from abuse and poor service. We believe very strongly that service charges should be transparent and communicated effectively, and that there should be a clear route to challenge or redress if things go wrong. The law is clear that service charges must be reasonable and, where costs relate to work or services, the work or services must be of a reasonable standard. Leaseholders may make an application to the First-tier Tribunal to make a determination on the reasonableness of their service charges or fees.

We established an independent working group chaired by Lord Best that considered how the service charge regime could be improved to increase transparency for leaseholders. The working group published its final report to Government (see: https://www.gov.uk/government/publications/regulation-of-property-agents-working-group-report) and we are considering the report's recommendations.