Leasehold System

15. What steps he plans to take to reform the leasehold system.

19. What steps his Department is taking to increase leaseholder protections.

The Government continue to implement those reforms to the leasehold system that are already in statute and to progress the wider set of reforms necessary to end the feudal leasehold system for good. We have brought into force a number of provisions in the Leasehold and Freehold Reform Act 2024, with more in the pipeline, and we remain on course to publish an ambitious draft leasehold and commonhold reform Bill later this year.

Leaseholders in my constituency face unfair practices such as management fees tripling in as many years, stretching families beyond their means. Yet there are also a great number of responsible agents, including L&A Lettings, based in Ashmore Park. Can the Minister set out how the Government’s leasehold reform will strike the right balance, protecting leaseholders from poor practice without overburdening responsible agents, who already provide a transparent and fair service?

We know that there are good managing agents who work hard to ensure that the residents they are responsible for are safe and secure and that homes are properly looked after, but we also know that far too many leaseholders suffer from poor service at the hands of unscrupulous managing agents. In our recent consultation on strengthening leaseholder protections over charges and services, we consulted on powers to appoint a manager or replace a managing agent as well as on mandatory professional qualifications for managing agents in England. We think that those proposals strike the right balance, but we are analysing all the feedback we receive to that consultation.

I thank the Minister for his answer to the previous question. In my constituency of Bury St Edmunds and Stowmarket, leaseholders are facing soaring service charges and falling standards. Some have told me that they are considering withholding payment. Does my hon. Friend agree that much greater regulation of property managers is urgently needed to ensure accountability and standards?

My hon. Friend highlights that, as many of us know, the reality of home ownership for so many leaseholders falls far short of the dream. We absolutely agree that we need to strengthen the regulation of managing agents, to drive up the standard of their service. We are looking again at Lord Best’s 2019 report on regulating the property agent sector, particularly in the light of the recommendations in the final Grenfell inquiry report. We have set out a number of specific proposals in the consultation that I referred to in my previous answer. Our preferred approach in implementing mandatory professional qualifications is for agents to belong to a designated body, but all final decisions will be taken in due course.

As the Minister will be aware, some freeholders find themselves trapped in a leasehold-like situation: the wider estate that they live on is managed by a management company and not adopted by the local authority. They are fleeced in exactly the same way by exorbitant management charges, and there are often unadopted roads and poor sewerage. Will the Minister meet me to discuss how we can provide protections for freeholders who find themselves in that leasehold situation?

We remain committed to protecting residential freeholders on private and mixed-tenure housing estates from unfair charges of the type that the hon. Lady described. We will consult this year on implementing the 2024 Act’s new consumer protection provisions for the 1.75 million homes that are subject to those charges. We are committed to bringing those measures into force as quickly as possible.

Thousands of my constituents in Stratford-on-Avon now live in so-called fleecehold developments, often with a lack of transparency in how service charges are set and a lack of maintenance of public open spaces, including drainage infrastructure. Will the Minister reassure my constituents that any leasehold reform will including tackling fleecehold and that the reforms will be applied retrospectively?

I can assure the hon. Lady that we will tackle the injustice of fleecehold as part of the ambitious changes that we intend to make to the leasehold system, with a view to bringing it to an end in this Parliament. The consumer protection provisions in the 2024 Act, which I have already mentioned, will ensure that homeowners who pay an estate management charge will have better access to the information that they need to challenge the reasonableness of charges at the first-tier tribunal. There are other powers as part of those protections and, as I have said, we will consult on them shortly and bring them into force as quickly as possible thereafter.