Government Targets Rogue Property Managers in Leasehold Crackdown

New Consultation Aims to End Unfair Charges, Surprise Repairs, and Legal Traps

In a bold move to clean up England and Wales’ murky property management sector, Housing Minister Matthew Pennycook has vowed to end what he described as the “wild west” of property managing agents. Launching a sweeping government consultation, Pennycook set his sights on ending unfair service charges, improving transparency, and ensuring that all property managers are professionally qualified.

This marks the next phase of the UK government’s long-promised overhaul of the leasehold system, affecting over 5 million homes.

A Broken System in Urgent Need of Repair

Leaseholders at the Mercy of Unregulated Agents

For millions of homeowners under leasehold contracts, property management has long felt like a rigged game. Hidden fees, unexplained charges, and eye-watering legal costs are rampant in a system Pennycook says is “suffering from a complete lack of accountability.”

“Managing agents play a key role in multiple-occupancy buildings and will play an even bigger role in the future, but it is a bit of a wild west at the minute,” Pennycook said.

The problem, according to the minister, is the lack of standards or regulation. In his own words:

“A group of us could set up as a managing agent by renting an office above a newsagent — and that’s the problem.”

The Plan to Rein In Abuse

Government Launches 12-Week Consultation

The new 12-week consultation, opened this week, will gather views on a set of major reforms to property management and leasehold practices, including:

• Mandatory professional qualifications for all property managers

• Transparent itemised billing for service charges

• Restrictions on unjustifiable legal costs in leaseholder disputes

• Greater oversight for surprise or major repairs

This consultation follows reforms introduced via the 2024 Leasehold and Freehold Reform Act, a law originally passed by the Conservatives but now being implemented and expanded by the Labour government.

“Leaseholders are suffering and they need urgent relief — that’s why we are doing what we are,” Pennycook said.

Real Stories, Real Abuse

From Phantom Lifts to Hidden Legal Traps

MPs across the UK have relayed disturbing stories from their constituents:

• One homeowner was billed for lift repairs — in a building with no lift.

• Others have seen above-inflation increases in service charges with no justification.

• Some leaseholders have gone to court, won their cases, but still ended up paying their opponent’s legal costs.

These abuses, Pennycook says, are not rare. They represent a systemic issue that the government is determined to end.

A Professional Standard — At Last

New Licensing for Managing Agents

A key proposal in the consultation is the creation of professional qualifications and a regulatory body for managing agents — a move the government believes is long overdue.

Currently, anyone can operate as a managing agent with no licensing, no training, and no oversight. This has created space for incompetent operators and exploitative companies to thrive.

Under the proposed changes, only licensed professionals will be allowed to manage leasehold properties, with clear standards of conduct and penalties for violations.

Major Works Reform: No More Surprise Bills

Another vital reform under consideration will regulate the way major works and emergency repairs are handled. Currently, property managers can spring five- or six-figure bills on leaseholders with minimal notice or explanation.

The consultation aims to design a predictable, transparent process for initiating and charging for large-scale works, ensuring residents are consulted early and given clear breakdowns of costs.

Reform Momentum Builds — But Not Without Critics

Campaigners Want Faster, Bolder Action

While many leaseholders and advocacy groups welcome the government’s actions, some campaigners are frustrated with the pace of change. They argue that despite high-profile promises, key reforms are still not on the books.

Pennycook acknowledged the concerns but promised that a draft leasehold reform bill would be introduced by the end of the year, containing:

• A ban on leasehold for new-build flats

• Simplified conversion processes to freehold or commonhold

• Stronger protections for existing leaseholders

“It will be an ambitious piece of legislation, but there are many moving parts,” he said.

What Comes Next

This consultation signals a turning point in how the UK treats leaseholders — a group historically treated as tenants despite being homeowners. If implemented, the reforms could reshape the £50bn property management sector and deliver long-overdue fairness to millions of people.

Leaseholders and industry professionals are encouraged to respond to the consultation before it closes in 12 weeks.

In the meantime, Pennycook and his department are preparing for a long-overdue legal and cultural shift: one that recognizes leaseholders not as second-class owners, but as individuals deserving transparency, professionalism, and respect.