Property Service Charges

Debate between Matthew Pennycook and Helen Maguire

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.

Renters’ Rights Bill

Debate between Matthew Pennycook and Helen Maguire

Tuesday 14th January 2025 Commons Chamber

[Matthew Pennycook]

It is a pleasure to bring this important Bill back to the House this afternoon. Let me begin by thanking hon. Members on both sides of the Chamber for their engagement with it over recent months. In particular, I thank the shadow Minister, the hon. Member for Ruislip, Northwood and Pinner (David Simmonds), and other members of the Committee for the diligent and thoughtful line-by-line scrutiny of the Bill that they undertook over the course of many sittings late last year.

This Labour Government promised to succeed where their predecessor had failed, by quickly and decisively acting to transform the experience of private renting in England. Today, we make further tangible progress towards delivering on that commitment. Our Renters’ Rights Bill will modernise the regulation of our country’s insecure and unjust private rented sector, levelling decisively the playing field between landlord and tenant. It will empower renters by providing them with greater security, rights and protections so that they can stay in their homes for longer, build lives in their communities and avoid the risk of homelessness.

It will ensure that we can drive up the quality of privately rented housing so that renters have access to good-quality and safe homes as a matter of course. It will also allow us to crack down on the minority of unscrupulous landlords who exploit, mistreat or discriminate against renters. The Bill will also provide tangible benefits for responsible landlords who provide high-quality homes and a good service to their tenants. Not only will its provisions see the reputation of the sector as a whole improve, as we clamp down on those landlords whose behaviour currently tarnishes it, but the Bill will also ensure that good landlords enjoy simpler regulation and clear and expanded possession grounds, so that they can regain their properties quickly when necessary.

Although we have eschewed the previous Government’s habit of shoehorning swathes of new clauses into legislation following Second Reading, we needed to make a modest number of improvements to the Bill in Committee. Many of the amendments in question were minor and technical or consequential in nature, but I shall briefly explain to the House some of the more substantive changes.

To increase fairness for tenants being evicted because their landlord is at fault, we chose to make an amendment connected to ground 6A. As hon. Members will be aware this mandatory ground allows landlords to remove their tenants when eviction is necessary for them to comply not only with enforcement action, but as a result of separate changes that we made to the Bill with planning enforcement action as well. The amendment allows the court to require landlords to pay compensation to the tenant when they are forced to vacate their homes under such circumstances.

To provide greater flexibility for social landlords in meeting the demands of local housing markets, we widened ground 1B for rent-to-buy tenancies, ensuring that registered providers can take possession in all necessary circumstances. We also exempted assured tenancies from the 90-day rule, which protects housing supply in London and benefits permanent residents by preventing the conversion of family homes into short-term lets. Should a tenant give notice early in their tenancy, meaning that they leave before 90 consecutive nights have passed, these changes mean that the landlord will not automatically be found to have inadvertently provided temporary sleeping accommodation.

Lastly, we made changes to ensure that the introduction of a decent homes standard in the private rented sector works as intended.

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

Last week, I asked the Government to ensure that all service family accommodation meets the minimum standards of social housing, as set out in the decent homes standard. The Minister for Veterans confirmed that this is already done, so will the Government support amending the Renters’ Rights Bill officially to extend the decent homes standard to Ministry of Defence service family accommodation?

[Matthew Pennycook]

I thank the hon. Lady for her question and I agree with the objective that she has in mind, but, as we discussed fairly extensively in Committee, we do not think that the Renters’ Rights Bill and the way that the decent homes standard will apply to assured tenancies in this sector is right for MOD accommodation. The MOD is undertaking its own review, and I shall touch on that issue later in the debate.

As I was saying, the changes around the decent homes standard will guarantee that the appropriate person can always be subject to enforcement action and they close a potential gap that may have been exploited by clarifying the types of accommodation that will be required to meet the standard.

Today, we are proposing a small number of further improvements, most of which are again minor and technical in nature. As I have made clear repeatedly, the Government have long recognised that demands for extortionate amounts of rent in advance put undue financial strain on tenants and can exclude certain groups from renting altogether. I am sure that many of us in the Chamber will have heard powerful stories from our constituents about the impact of such demands. The typical story is all too familiar. Tenants find and view a property which, as advertised, matches their budget only to find that, on application, they are suddenly asked to pay several months’ rent up front to secure it. Tenants in such circumstances often confront an almost impossible choice: do they find a way to make a large rent-in-advance payment, thereby stretching their finances to breaking point, or do they walk away and risk homelessness if they are unable to find an alternative?