Landlords ‘looting' millions of leaseholders under Labour
A series of reforms aimed at boosting leaseholder powers have been unveiled by the Government, but critics argue they will fail to deliver change.
Under new rules, leaseholders will be able to more easily challenge extortionate service charges, which they are required to pay to cover the upkeep of shared areas in their building.
The new proposals – labelled 'performative nonsense' by campaigners – come after Labour previously rowed back on a commitment to abolish leasehold within 100 days of taking power.
Housing minister, Matthew Pennycook, said the party still plans to bring the 'feudal system' to an end, but a timeline on the pledge has not been made clear.
The smaller reforms have been proposed in a new consultation unveiled by Angela Rayner's Ministry of Housing, Communities and Local Government.
It says leaseholders will receive a standardised service charge documentation each year which will spell out clear and detailed information about how their rates are calculated and spent.
This is hoped to 'make it easier for them to challenge unreasonable bills, and potentially save money where expenses are unjustified'.
Further reforms are aimed at stopping leaseholders who have successfully challenged their bill from having to automatically pay for landlords' litigation costs.
Property managers will also be forced to qualify as professional practitioners for the first time.
Mr Pennycook said: '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.'
But Harry Scoffin, of the campaign group Free Leaseholders, said the proposals do not go far enough and leaseholders will continue to be 'looted' by landlords.
He said: 'There is this endless number of consultations. The Government is investing all of this energy on tweaking the current system, rather than abolishing leasehold. We will continue to be looted.
'It's a real worry. Leaseholders are exhausted, and do not want to spend years of their life becoming serial litigators challenging their landlords, which is what would happen here.
'The Government says the reforms will strengthen the arm of leaseholders, but this won't work. These tribunals aren't friendly and leaseholders are sometimes up against KCs, literally the creme de la creme lawyers in the land.'
Posting on X, Jay Silva wrote: 'More dithering. Why do we need more consultations? How many more of them do successive governments want?'
Another user labelled the proposals 'performative nonsense'. They said: 'You said you would abolish leasehold and have not. This is more stalling.'
Last October, Mr Pennycook warned that leasehold reform could take as long as five years, describing it as a 'whole of Parliament commitment'.
In its manifesto, Labour said it would 'ban new leasehold flats and ensure commonhold is the default tenure'. The party went on to reiterate this promise in the King's Speech, also promising to regulate ground rents and to 'act quickly' to implement its reforms.
In May 2023, Lisa Nandy, the former shadow housing secretary, said a future Labour government would bring forward legislation to abolish leasehold within 100 days. But in April, the party quietly dropped this pledge.
The Leaseholders Charity said the Government's latest proposals – which are out for consultation until the end of September – were announced 'with as much enthusiasm as a visit to the dentist'.
There are 4.8 million leasehold properties in England, equivalent to a fifth of the country's housing stock. In 2023-24, leaseholders paid an average annual service charge of £1,720, but some costs spiralled to five figures.
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