Property Service Charges

Richard Foord Excerpts

Thursday 30th October 2025 Commons Chamber

[Katie Lam (Weald of Kent) (Con)]

I congratulate my hon. Friend the Member for Reigate (Rebecca Paul) on securing this debate in the House. Earlier this year, I wrote to hundreds of residents across the Weald of Kent to get a better understanding of how property management companies operate across our home. What I discovered was very worrying and, as many Members here will recognise, it is an all too common story. To date, I have heard from nearly 100 people across 11 estates all complaining about their property management company FirstPort. The pattern is as depressing as it is predictable: steep and unexplained increases in service charges, slow and inadequate responses to maintenance issues, and a serious lack of accountability and transparency.

Let me share a few examples. Constituents in Yalding and Headcorn have told me that they face a 70% and a 40% rise in their management fees respectively. Those are not minor uplifts, and nobody can tell them clearly what they are paying for. I understand that costs are rising not least for things like insurance, but at the very least, hikes like that should be clearly explained. Constituents in Marden and Kingsnorth have documented cases where no maintenance at all was carried out for months, despite repeated chasing—grass not cut, lights not fixed and rubbish not cleared—and yet the bills keep coming.

Finally, constituents in Tenterden and Coxheath have told me that it is beginning to affect the value of their homes, as my hon. Friend mentioned. Some have said that their properties are becoming unsellable because buyers will not take on the liability of these charges and this management. In one case, two sisters are trying to sell their late father’s flat. He bought it for £150,000 and they now cannot even sell it at £60,000. At auction, the price has fallen below £20,000. They told me that local estate agents refuse to list it because of the fees associated with managing the property.

Much of this is part of a wider pattern. Many residents on these estates pay twice for what most people would regard as the same basic services. They pay full council tax to their local authority, as everyone does, but on a growing number of estates, the council has not taken over the roads, street lighting or green spaces and therefore does not maintain them.

[Richard Foord (Honiton and Sidmouth) (LD)]

To that point about councils not having yet adopted such things as the roads or pavements, I have the example of Pebble Beach in Seaton where I represent, where residents have been charged fees and even threatened with legal action before the estate has been handed from the developer to the property management company. Has she come across that, too?

[Katie Lam]

I am afraid so, and fairly regularly in fact. The legal action that the hon. Member mentions is important to reflect on because it can in some cases be deeply distressing and seem very aggressive for people just trying to get what they have already paid for, which in some cases does not even exist yet.

Residents are required to pay a second set of charges on top of the council tax to a private management company, such as FirstPort. They pay council tax for street lighting and then they pay a private company for street lighting. They pay council tax for maintaining the verges, and then they pay again for someone to cut the grass—except of course in many cases the grass is not cut. In these situations, the homeowner has almost no practical leverage. The council says, “It is private land”; the management company says, “You are contractually obliged to pay us anyway”; and the person who lives there, who cannot simply switch provider and who must disclose the charges when they come to sell, is left with little ability to challenge poor value. People are paying more and getting less. There is a continuing lack of transparency, with residents routinely denied a proper breakdown of charges, not given meaningful answers and, in some cases, not even given the dignity of a reply.

FirstPort is one of many property management companies that have been allowed, in some respects, to conduct themselves with impunity, largely because local residents have almost no consumer power or transparency. I have met representatives of FirstPort, and they assure me that the company is changing and improving. I very much hope that this is true. But, in case that does not happen, the last Government took important steps to address this through the Leasehold and Freehold Reform Act 2024.

The purpose of the Act is to give residents clear information about what they are being charged and why; to widen access to redress when something goes wrong, which is crucial; and to ensure that disputes with management companies can be resolved fairly. But residents will not see those benefits until all the secondary legislation is brought into force, guidance is published and management companies are given a clear expectation that they will need to comply.

I caution the Government against assuming that the answer might be to layer on fresh regulation or to draft a new Bill. I encourage the Government to accelerate the implementation of those elements of the Act. My constituents do not want to wait, say, another year to see itemised, comprehensible service charge bills and prompt access to redress. They accept that the streetlights must be maintained, the gutters cleared and insurance bought—they know all of that costs money—but what they will not accept, and nor should they, is paying more for less with no answers and no accountability.

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[Lee Pitcher (Doncaster East and the Isle of Axholme) (Lab)]

I often hear the same story across Doncaster East and the Isle of Axholme about bills that jump without warning, charges that people cannot control, invoices that are hard to decipher and work that arrives late or not at all. If we pay for services, we should know what we are paying for, the standard we can expect, and how to put things right when they go wrong.

There has been some progress on what has been coined “fleecehold”, and on the rights of homeowners. I welcome steps to protect leaseholders from unjustified service charges and to raise standards in managing the agent sector, but many people still feel powerless when a bill lands. Change must bite on the ground.

We have heard that many households pay estate rent charges on top of council tax, and in the worst cases there are excessive or unexplained fees, charges for services that would normally be provided by local authorities, arbitrary administration costs and fees imposed during a sale. Too many discover too late that roads, verges and play areas are not adopted. No family should be ambushed by a large one-off bill for works that they could not foresee. Clear pre-sell disclosure and sensible reserve planning are essential.

There are good actors. Resident-led management companies, responsible freeholders and professional agents already publish clear breakdowns and engage on works early. They should feel backed by a system that raises the floor and rewards good practice. I therefore ask the Minister today for four things. First, will the Government promptly bring forward secondary legislation? We need to define what insurance fees are permitted, end hidden commissions and require standardised, transparent statements, so residents can see where every single pound goes. Secondly, will they set professional standards for managing agents? We need mandatory qualifications and a robust code of practice that will lift the quality bar and give residents confidence that estates are run properly. Thirdly, will they fix the major works regime? We need clear pre-sale information to be provided, early engagement on big projects to be required, sensible reserves to be planned, and safeguards put in place, so that households are not hit by avoidable spikes. Fourthly, will the Government make redress fast and affordable? We need to resource the first-tier tribunal, and publish simple guidance, so that residents can challenge unreasonable costs without needing deep pockets. I am sure that a small number of timely rulings will reset behaviour across entire developments.

My constituents in Doncaster East and the Isle of Axholme are not asking for special treatment. They are just asking for fairness—bills that are clear, charges that are reasonable, and services delivered as promised. I have set up a number of street surgeries in the areas from which I get the most comments on this matter. That way, I can hear constituents’ voices and directly feed back what they have said to the Minister and the Department as we move forward with the legislation. With prompt secondary legislation, tight definitions on insurance, professional standards for agents and an accessible tribunal system, we can turn a confusing and stressful system into one that treats residents with respect and provides peace of mind.

[Richard Foord]

The hon. Member talks about secondary legislation when suggesting what should happen next. The Leasehold and Freehold Reform Act provides protections for leaseholders on private managed estates; it enables them to go to a tribunal to challenge management charges. Does he think that that ought to exist for freeholders as well?

[Lee Pitcher]

The hon. Gentleman makes a valid point, and it is certainly one that the Minister should listen to and take into account. I was concluding when he intervened, so I will finish with this: our home should be a place where we get to dream, not where we have nightmares.