MHCLG publishes consultation on leasehold reform

The Ministry for Housing, Communities and Local Government (MHCLG) has published a consultation paper on measures aimed at giving leaseholders “stronger rights, powers and protections”.

The paper proposes ‘switching on’ measures in the Leasehold and Freehold Reform Act 2024 to improve service charge transparency.

MHCLG is consulting on new standardised service charge demand forms, annual reports, service charge accounts and administration charges.

It is also seeking feedback on measures to improve buildings insurance transparency including on what information should be provided to leaseholders, so they better able to challenge any unreasonable insurance charges.

The paper proposes measures designed to remove barriers for leaseholders to challenge their landlord, reforms to section 20 ‘major’ works procedures and the introduction of mandatory qualifications for managing agents.

MHCLG also wants to consider “the case for greater protections for leaseholders paying fixed service charges, protections for client money, or improvements to the process for appointing a manager in cases of serious management failure”.

>>See also: Are housing associations really overcharging residents?

Matthew Pennycook, housing minister, said: ““The cost of living remains a pressing concern for leaseholders and many are struggling financially as a result of high and rising service charges, and other opaque and excessive leasehold costs.

“This bold package of reforms will arm leaseholders with greater rights and protections and empower them to challenge poor practice and unreasonable charges and fees – driving up leaseholder living standards as we work to bring the feudal leasehold system to an end as part of our Plan for Change.”

The UK government is planning a Leasehold and Commonhold Reform Bill, which is expected later this year. The consultation closes on 26 September.