Flat owners handed massive boost to fight rip-off service charges
Over three million leaseholders across England will benefit from stronger rights that will help challenge unfair service charges, starting from 1 April 2027.
- Millions of leaseholders to get stronger rights to know exactly what they are paying for and challenge unfair or unexplained service charges
- New protections will stop leaseholders being saddled with landlords’ legal bills for challenging costs
- Further changes will make information on charges standardised, clearer and upfront
Over three million leaseholders will have more control of their cash and stronger rights to tackle unfair service charges, as the government delivers another everyday fix to stop homeowners being left out of pocket by unfair costs.
From 1 April 2027, leaseholders will gain strong powers to demand information about their service charges, making it easier to see what they are paying for and why.
This will give people a clearer picture of how their building is managed, maintained, repaired and insured. Leaseholders will be able to ask for information from previous years and landlords will need a good reason to refuse to provide it.
From the same date, leaseholders will also get stronger protection from having to pay their landlord’s legal costs when they challenge a charge. This will end a huge barrier to fighting costs, by stopping landlords from charging leaseholders whether they win or lose, as a power to put them off.
Landlords will need court or tribunal approval to pass on any legal costs to leaseholders and to balance the scales of justice, leaseholders will get the new right to claw back their own legal expenses too.
Together, these changes will make it easier for leaseholders to understand and challenge unfair costs - another everyday fix tackling a real cost of living concern for homeowners, families and aspiring first-time buyers.
Prime Minister Andy Burnham said:
It is simply wrong that millions of leaseholders can be hit with unfair charges, then face another bill just for challenging them. That isn’t right, and where we can act quickly to change it, we will.
Today’s changes are only the beginning. We’re giving leaseholders stronger rights now, while we press ahead with the bigger reforms needed to put power back in homeowners’ hands and end the feudal leasehold system for good.
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.
Even stronger rules from 1 November 2027
From 1 November 2027, leaseholders will automatically get clearer information about the charges they are being asked to pay – whether their building is owned by a private landlord, council or housing association.
This includes detailed information about the building insurance they help pay for, along with stronger protections against excessive or unreasonable fees for arranging and managing that insurance. Leaseholders will also receive clearly set out information on admin fees they could face.
Private landlords will have extra requirements. They will have to use simpler, standardised service charge demand forms and provide financial accounts and annual reports - giving leaseholders clearer information about what they are being charged and how their money is being spent.
Clearer service charge reporting extended to social housing from 1 November 2028
From 1 November 2028, councils and housing associations will also have to provide their leaseholders with the new standardised service charge demand forms, financial accounts and annual reports.
Plans form part of a wider leasehold shake-up
These changes bring in key protections from the Leasehold and Freehold Reform Act 2024, giving leaseholders more information and greater power over the costs they are asked to pay.
Further reforms are also planned through the Commonhold and Leasehold Reform Bill, which is due to be introduced in Parliament before Christmas 2026.
Chief Executive of the Leasehold Advisory Service, Kion Ahadi said:
Service charges are the most common issue leaseholders contact us about. We welcome these changes as an important step forward in helping people understand what they are paying for and challenge costs they believe are unfair.
Leaseholders need clear information about how their money is being spent and a fair opportunity to raise concerns.
Better access to that information and stronger protection from landlords’ legal bills will give them more confidence to hold their landlord to account.
Further information
Following consultations in 2024 and 2025, five sets of regulations are being laid in Parliament on 12 November 2026 to bring these new leaseholder protections into force. Together they put in place the detailed rules for the new service charge, information, building insurance and landlord legal cost protections. Subject to Parliamentary approval, different parts of those regulations then come into force at different points: 1 April 2027, 1 November 2027 and 1 November 2028.
One additional set of regulations will be laid in Parliament before the end of 2026, to set out further detail on how the litigation cost reforms will work. The regulations will commence on 1 April 2027.
The reforms are being phased in to get protections to leaseholders as quickly as possible while giving landlords time to make the necessary changes to their billing, accounting and service charge systems. Responses to the government’s consultation made clear that organisations would need sufficient time to prepare for the new requirements.
Councils and housing associations have an additional 12 months to introduce the new standardised service charge demands, accounts and annual reports because of the complexity of their accounting and service charge systems. The government has gathered evidence from social landlords to inform this timetable.
The Commonhold and Leasehold Reform Bill will overhaul the way flats are owned and managed. This includes making a revised commonhold model – a stronger form of ownership – the default for most new flats. It will also make it easier for existing leaseholders to move to commonhold, will cap existing ground rents at £250 and replace the current forfeiture system with a fairer enforcement regime.
Commonhold gives flat owners outright ownership of their home and a greater say over how their building is run, rather than having a third-party freeholder controlling the building. While commonhold already exists, the Bill will overhaul the current model to make it work better for homeowners and become a realistic alternative to leasehold.