Overview

The Leaseholders’ Rights Bill aims to strengthen the rights of leaseholders in England and Wales regarding the management and maintenance of their properties. It increases leaseholder involvement in decisions about building works and introduces measures to protect them from excessive service charges.

Description

This bill primarily amends the Landlord and Tenant Act 1985 and the Housing Act 1985. Key changes include:

• Increased Leaseholder Consultation: Landlords must now consult leaseholders on proposed works, including providing cost estimates, inviting suggestions for alternative contractors, and allowing leaseholders to submit counter-proposals. A ballot of affected leaseholders will be held on counter-proposals supported by at least 25% of tenants. The landlord must adopt the counter-proposal if it receives majority support.
• Transparency and Accountability: Landlords are required to provide reasons for carrying out works in certain circumstances and make details of proposed works, consultations, and decisions publicly available for ten years.
• Service Charge Caps: If a leaseholder's annual service charge exceeds £12,000 (subject to inflation adjustments by the Secretary of State), the landlord must arrange for payment in reasonable installments.
• Dispute Resolution: The bill allows for leasehold valuation tribunals or other independent arbitration to resolve disputes related to proposed works or agreements.
• Secretary of State Consultation: The bill also mandates the Secretary of State to consult on housing management policies and measures relating to the matters in paragraphs (a) and (b) about which the Secretary of State has published a consultation document to which the landlord authority intends to make a written response.

Government Spending

The bill does not directly specify a cost to the government. The increased administrative burden on landlords and the potential need for dispute resolution may indirectly impact government resources through increased work for tribunals or other regulatory bodies. The long term impact of the bill on Government spending is currently unknown.

Groups Affected

The bill primarily affects:

• Leaseholders: They gain increased rights to participate in decisions regarding building works and service charges, leading to greater control over their properties and protection against excessive costs.
• Landlords: They face increased administrative burdens associated with consultation requirements and potential financial implications related to counter-proposals and installment payment arrangements for high service charges.
• Leasehold Valuation Tribunals and other Arbitration bodies: They are likely to experience an increase in workload due to potential disputes arising from the new consultation and decision-making processes.

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