Property Service Charges

Helen Maguire Excerpts

Thursday 30th October 2025 Commons Chamber

[The Minister for Housing and Planning (Matthew Pennycook)]

It is a genuine pleasure to follow that constructive speech by the shadow Secretary of State, the right hon. Member for Braintree (Sir James Cleverly). I congratulate the hon. Member for Reigate (Rebecca Paul) on securing a debate on what is without question a critically important and pressing issue for residential freeholders and leaseholders alike across the country, and one that, as the shadow Secretary of State rightly said, enjoys significant cross-party consensus. In opening the debate, the hon. Lady spoke forcefully and eloquently on behalf of her constituents in Redhill and, in sharing their plight with the House, brought alive the financial and emotional toll that leasehold terms can take on homeowners across the country.

The many excellent contributions that followed from hon. and right hon. Members powerfully reinforced the arguments that the hon. Lady made. The case studies littered across those contributions were shocking but will not have surprised anyone in this House. We all know from the work we do supporting leaseholders and residential freeholders in our constituencies that, for far too many of them, the reality of home ownership has fallen woefully short of the dream. It is precisely because this Government are no longer prepared to accept that situation that we are determined to honour the commitments made in our manifesto and do what is necessary to finally bring the feudal leasehold system to an end in this Parliament.

I do not intend to detain the House for a huge amount of time—I know there is another debate to follow—but in the time I have available I would like to address the main issues that have been raised in the debate, starting with the various problems affecting homeowners on private and mixed-tenure housing estates. But, as ever, I am more than happy to meet any hon. or right hon. Member who has raised an issue that I am unable to cover.

As several hon. Members argued in their contributions, we have seen over recent years a significant shift away from a situation where local authorities and utility companies would generally adopt the respective amenities and public spaces within new residential developments to one where private management arrangements take hold—a so-called fleecehold arrangement. Shared amenities and open spaces are now routinely not adopted and maintained at the public expense, and the maintenance costs fall to residents through an estate rent charge, a fee paid in addition to council tax.

The estate charge also normally covers the management costs of the estate management company, although, as has been evidenced in the debate, residential freeholders frequently complain that these companies deliver little, if anything, beyond what a local authority would usually provide in an area where amenities would have been adopted.

My Department estimates that up to 1.75 million homes in England are located on such private and mixed-tenure estates, although not all are subject to charges. Properties on these estates often have restrictive covenants registered at the Land Registry. They may require homeowners to seek permission, often for a fee, from the management company for actions such as selling or letting their home or altering its appearance. In the worst cases, residents face excessive or unjustified charges levied for minimal services. Those may include fees for services normally provided by local authorities, arbitrary and costly administration fees, unexplained increase in charges and fees imposed during the sale of their home.

[Helen Maguire (Epsom and Ewell) (LD)]

I just want to add one more case study to the plethora that have already been provided today. I have a resident who has a one-bed flat who saw their charges rise by thousands of pounds in just a few years. That financial burden also makes it even harder to sell their property. Simply too many rogue developers and estate management companies, as alluded to, are exploiting residents and demanding excessive fees for maintaining shared and public spaces in developments. Will the Minister, as many Members have called for, today commit finally to cracking down on these money-grabbing companies, capping unreasonable service and management charges, and urgently abolish ground rents on existing leases?

[Matthew Pennycook]

If the hon. Lady had been present for the debate, she would have heard extensive exchanges on this subject, but I will set out what the Government intend to do to provide leaseholders and residential freeholders with redress in these areas.