Introducing protections from the Leasehold and Freehold Reform Act 2024, these changes will take effect from April next year.
Leaseholders will be able to ask landlords for information on how their building is managed, maintained, repaired and insured and receive information from previous years. Landlords will need to give a good reason for any refusals to provide the information.
Landlords will also need approval from a court or tribunal to be able to pass legal costs onto leaseholders, and leaseholders will be able to claim back their own legal expenses.
Also from April, leaseholders will be better protected from paying their landlord’s legal costs when they challenge a charge, preventing instances of landlords charging leaseholders whether they win or lose a claim.
From 1 November 2027, leaseholders will automatically receive clearer information about the charges they pay, and gain protection against excessive or unreasonable fees for arranging and managing buildings insurance. They will also get information on the admin fees they may face.
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From the same date, private landlords will have to use simpler, standardised service charge demand forms and provide financial accounts and annual reports to give leaseholders clarity around how money is being spent.
This will be extended to councils and housing associations from 1 November 2028.
Further reforms are planned through the Commonhold and Leasehold Reform Bill, which is expected to be introduced to Parliament before Christmas.
Housing Minister Matthew Pennycook said: “Rapidly escalating and frequently opaque service charges are placing huge financial strain on hard-pressed leaseholders across the country.
“Today, we’re acting to protect them by introducing regulations that will improve the fairness and transparency of service charges so that unreasonable increases can be more easily challenged.
“As we work to dismantle the feudal leasehold system in this Parliament, we won’t leave existing leaseholders behind.”
