20/10/2017.
Proposals to protect property leaseholders against high service charges (E).
A package of measures to help protect the owners of 4.2m leasehold properties in England from rogue property managers and high service charges estimated at between £2.5bn and £3.5bn pa is set out for comment in a call for evidence published by Communities Secretary, Sajid Javid.
Evidence of leaseholders being charged ten times more than the market rate for alterations to their properties have been submitted to the government. Research by the consumer group Which? found that £700m of unnecessary service charges were being paid each year, while the All Party Parliamentary Group on leaseholds think it could be as much as £1.4bn.
Anecdotal evidence of excessive charges cited by the government includes
- a group of leaseholders charged ten times the market rate to have a new fire escape fitted – with the £30,000 contract handed to the freeholder’s brother
- a landlord charged £500 by his agent for repairing a shower door
- a London-based property agent who tried to charge a leaseholder almost £5,000 to transfer ownership of a parking space to other leaseholders
‘Protecting consumers in the letting and managing agent market: call for evidence’ seeks views on measures to
- empower consumers by, for example, giving them a greater say over the appointment of managing agents
- increase transparency so tenants and leaseholders know what they are being charged for and why
- ensure fairness and openness around relations between freeholders and agents
- look at what qualifications are needed by agents to practice and how regulation can be improved
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