Leaseholders across London are raising concerns over mounting management fees and opaque billing practices, which they say are pushing them into significant debt. Audra Woods and Alice Brown, who own two flats in a block near Richmond, have collectively incurred over £40,000 in fees in three years from a management company they claim has provided little to no justification for the charges.
This issue is not isolated. More than 1,000 people contacted BBC London following an investigation into leasehold practices published in November. The government has pledged to address these issues with reforms to improve leasehold transparency, simplify self-management, and introduce a draft reform bill in 2025.
Rising Fees Without Explanation
Alice Brown recently received a £3,500 bill for maintenance, with no breakdown provided. “We’ve yet to see any maintenance done on the property, but the costs keep rising,” she said.
The pair also reported being charged for multiple building surveys, each costing around £1,000, which they claim were never conducted. Ms. Brown questioned the need for a management company at all, noting the absence of communal spaces or shared assets like lifts or gardens.
Ms. Woods said the financial strain has deeply impacted her life. “Every time I think of £20,000, I’m thinking, ‘that’s my pension.’ They’re ruining my life—it feels criminal.”
Similar Struggles Across London
Tabitha Sudbury, a leaseholder in Coulsdon, faces a similar predicament. She and her neighbors have been billed £10,000 each for “work that was apparently meant to be done” but have not seen any evidence of plans or completed projects. Ms. Sudbury emphasized the need for stricter oversight of management companies and mechanisms to recover misspent funds.
Government Response and Planned Reforms
Housing Minister Matthew Pennycock acknowledged the widespread strain on leaseholders due to rising service charges. He stated that the government aims to implement measures under the Leasehold and Freehold Reform Act to enhance transparency and simplify the process of challenging unfair charges.
The Labour government plans to abolish the “feudal” leasehold system by the end of this Parliament, making commonhold the default tenure. Reforms slated for 2025 include:
• Removing the two-year rule for extending leases or purchasing freeholds
• Simplifying “right-to-manage” provisions for self-management
• Introducing consultations on service charges and legal costs
• Publishing a draft Leasehold and Commonhold Reform Bill
Mark Chick from the Association of Leasehold Enfranchisement Practitioners (ALEP) expressed cautious optimism about the reforms, highlighting the need for time to implement changes properly to avoid administrative burdens.
Leaseholders across the city are hoping these reforms will provide much-needed relief and clarity in what many describe as an unmanageable system.
