More than three million leasehold homeowners will gain stronger rights to challenge spiralling service charges from April 1, 2027. The changes will give leaseholders new legal entitlements to request more information about what they are paying for, with the aim of providing a clearer picture of how their building is managed, maintained, repaired and insured.
Under the new rules, 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, ending the deterrent of landlords charging leaseholders whether they win or lose.
New protections for leaseholders
Landlords will need court or tribunal approval to pass on any legal costs to leaseholders, and leaseholders will gain the new right to claw back their own legal expenses. 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."
Burnham added: "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."
Further reforms from November 2027
Housing Minister Matthew Pennycook MP 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."
Rules will strengthen from November 1, 2027, with leaseholders set to receive clearer information automatically 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 the admin fees they could face.
Requirements for landlords and future plans
Private landlords will face new requirements, such as using simpler, standardised service charge demand forms and providing financial accounts and annual reports to give leaseholders clearer information about what they are being charged and how their money is being spent. From November 1, 2028, councils and housing associations will start needing to provide their leaseholders with the new standardised service charge demand forms, financial accounts and annual reports.
These changes will introduce key protections under the Leasehold and Freehold Reform Act 2024. Further reforms are also planned through the Commonhold and Leasehold Reform Bill, which is due to be introduced in Parliament before Christmas 2026. The Bill will include the already announced plans to cap existing ground rents at £250 a year, make it easier for existing leaseholders to move to commonhold, and make the revised commonhold model the default for most new flats. Commonhold means owning the freehold of your flat and having a greater say, alongside other owners, over how your building is run.
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."
