The London Assembly has called for changes to leasehold charges after hearing complaints that the current system lacks transparency.
A report by the Assembly’s Planning and Housing Committee notes that domestic leaseholders pay more than half a billion pounds in service charges every year.
Some leaseholders have expressed unhappiness at the level of charges, especially in the private sector which lacks the comprehensive and mandatory consultation processes of social landlords.
Assembly Members have called on the Government to review whether mediation should be “a compulsory first step” in dealing with disputes between landlords and leaseholders.
They also say the Mayor should consider the impact of any housing improvements he provides funding for on the service charges leaseholders pay.
Today’s report also calls on the Law Society to review whether information provided to prospective leaseholders should include details of planned works and estimates of service charges over the first five years of the lease period.
Steve O’Connell AM, who led the investigation, said: “Problems have dogged the service charges regime for many years. In some ways it’s an archaic and opaque system and many leaseholders are tearing their hair out with frustration.
“Some people would like to see leasehold done away with altogether, but failing that we must make sure that the system we have is as fair as possible.
“With disputes on the rise and many more leasehold properties in the pipeline it’s critical that all the agencies involved, from central Government down to the leasehold tribunal, look at ways of improving the transparency and equity of service charges.”
The report can be downloaded from the London Assembly’s website.
