"Residential leasehold management has become a growing part of our casework with tenants and landlords uncertain around their rights"
- Lesley Horton - The Property Ombudsman
The Property Ombudsman has published new guidance to support the owners of 4.8 million leasehold properties in response to a sharp rise in block and estate management disputes.
The redress scheme received 6,649 enquiries about residential leasehold in 2024, a 67% year-on-year spike with many consumers concerned about the fairness of service charges, which in most cases must be redirected to a court or tribunal.
The new guide, developed in collaboration with the first-tier tribunal (Property Chamber), aims to support residents with service charge disputes as well as health and safety concerns and complaints handling, by explaining where they can go to have different problems addressed.
Tenants and landlords may have their complaints considered by a property redress scheme where a business has not followed best practice. For example, a tenant alerts their managing agent about a leak in the property, but this never gets communicated to the landlord, so the problem worsens.
Certain complaints must be taken to the First-tier Tribunal, such as service charges, the appointment of a new manager or lease variations. The tribunal is independent of government and consumers may need to pay a fee to have their case reviewed.
With certain complaints, the Tribunal and the County Court both have powers, for example, to consider the reasonableness of service charges. Complaints such as who is liable to pay ground rent or determination of contractual costs are under the sole jurisdiction of the County Court.
Other options to help consumers with their complaints include contacting the local council, mediation, arbitration and the RICS dispute resolution service.
Finally, qualifying leaseholders are protected by the Building Safety Act 2022 in relation to the cost of replacing unsafe cladding or other defects. This is a complex area, and residents are advised to seek advice on their particular circumstances.
The Property Ombudsman is closely monitoring the current leasehold reforms and the gradual introduction of further rights for leaseholders and freeholders.
“Residential leasehold management has become a growing part of our casework with tenants and landlords uncertain around their rights," explained Interim Ombudsman Lesley Horton (pictured), "They are not helped by a complex landscape for redress with many taking expensive and stressful legal action to resolve disputes.
“We can consider and investigate complaints about the conduct of a business but we don’t have powers to set or challenge service charges which cover a building’s operating costs such as insurance, maintenance and repairs of external or communal areas.
“Working with judges at the first-tier tribunal, our guide is designed to help consumers navigate the various options open to them while the Government considers further regulation of the sector.”
