Strengthening leaseholder protections over charges and services: consultation

On 4 July, the government published a consultation on strengthening leaseholder protections over charges and services, as part of the implementation of the Leasehold and Freehold Reform Act 2024. The consultation sought views on proposals to implement aspects of Part 4 of the Act, as well as what future reform might look like.

The consultation is now closed, and we have submitted a full response on behalf of the sector. We engaged with our members on their viewsand responses to the consultation. Below, you will find a briefing and our full submission to the consultation.

What does this consultation mean for housing associations? 

The consultation asked significant questions on the implementation of the Leasehold and Freehold Act, particularly around sharing information with leaseholders and tenants. The proposals have implications for all housing associations who manage leasehold homes and those who recover the cost of services through a service charge. Proposals include the following: 

• Landlords will be required to provide leaseholders with information in a standardised way. The consultation is looking at the details of how the information landlords will be required to provide leaseholders will be shared. Proposals include a new standardised annual report and service charge demand form.  
• More information will be available to leaseholders on request. The consultation is seeking views on the expansion of the amount of information on request that landlords must provide to leaseholders.
• A new prescribed service charge demand form for tenants who pay fixed, or variable service charges will be introduced. This will sit alongside a simplified version of the prescribed annual report and a bespoke list of prescribed information that landlords must provide on request.
• Reforms to the section 20 ‘major works’ procedure. This includes proposals for the landlord to prepare Asset Management Plans, mandating the creation of reserve funds.
• The consultation explores whether further protections are needed for people who pay fixed services charges, including the right to challenge their reasonableness at the appropriate tribunal.

What did we say in our response to the consultation? 

In our response to the consultation, we said we support the government’s aim to improve people’s experiences of living in leasehold properties through greater accountability, transparency and value for money. However, we are concerned that some parts of the proposals are disproportionate and do not fully reflect different types of leasehold buildings or give residents enough choice about the information they receive. Without changes, there’s a risk that management costs may have to increase.    

We said the reforms should: 

• Deliver value for money for residents. If landlords have more flexibility to work with residents, they can focus on resident priorities and share meaningful information about their building.   
• Keep additional management costs to a minimum. Costs should be proportionate and flexible to meet the needs of both tenants and leaseholders.    
• Avoid duplicating existing or forthcoming regulations. Duplicating reforms will add more resource pressure on housing associations and make it more complicated for residents to know their rights. 
• The distinction between fixed and variable service charges should be kept. This is so residents have value for money and accommodate the many different types of buildings and services with varying degrees of complexity. 
• Have a longer transition period than 12 months. This is so that investment in new staff and system redesign can be done efficiently and work long term.   

Next steps

We’ll be updating this page once the government has responded to the consultation submissions. If you have any questions about the new legislation before then, please get in touch with our team using the contact details below.  

You can download our briefing and response below, and catch up on our recent webinar online.

NHF members can login to access the briefing.