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Tue 03 Apr 2018

Fantastic News: Leasehold sector to receive stronger protection from rogue managing agents

Fantastic News:  Leasehold sector to receive stronger protection from rogue managing agents


Thanks to new government proposals announced over the Easter Break, the Leasehold sector is to receive stronger protection from rogue managing agents. The proposals announced on 1st April include: 

·        Provision for an independent regulator and code of practice for letting and managing agents, to include having to obtain a nationally recognised qualification to practice, with at least 1 person in every organisation required to have a higher qualification.  In other words - CPD will be mandatory 

·        Greater support for leaseholders who wish to switch managing agents where their existing managing agents perform poorly or break the terms of their management agreement

·        Easier methods by which leaseholders can challenge unfair fees and service charges 

·        Harsher penalties for those who severely breach the new proposed code including the possibility of prosecution

The proposed new code will be developed by a working group comprising representatives of letting, managing and estate agents, as well as tenants and regulation experts. It has been announced that the group will be established as soon as possible and is expected to draw up the final proposals in early 2019. The group will also be tasked with reviewing in greater depth unfair additional charges for freeholders and leaseholders, specifically whether they should be capped or banned. This seems to include the use of restrictive covenants, leasehold restrictions and administration charges.

Yashmin Mistry, Property Practice Group Leader and expert in leasehold issues says, “The Government’s announcement is welcome news and long overdue – many groups, trade bodies, individuals and the industry itself has been campaigning for more regulation for several years.  It will be interesting to see further details as they develop.  I am particularly interested to see what further details develop in respect of the format the qualification will take and the balance the code will need to strike between blocks managed by professional managing agents and those that are self-managed”.

For more details on the proposals, please visit:  https://www.gov.uk/government/news/new-crackdown-on-rogue-agents-to-protect-renters-and-leasehold-homeowners 

Please contact Yashmin Mistry, Partner and Property Practice Group Leader at JPC Law here for more information.

 

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