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Fighting Unfair Fees Associated With Leasehold Property Transactions

Fighting Unfair Fees Associated With Leasehold Property Transactions

The Conveyancing Association is putting pressure on the Government to update the Consumer Rights Bill, which is currently making its way through parliament, to stop rogue managing agents from delaying or preventing the sales of leasehold properties. The sales of some 300,000 properties could be affected this year by hold-ups and steep fees.

One in every three property transactions involve leasehold properties, of which there are 5m in England and Wales. Total annual leasehold fees add up to £80m. The Legal Ombudsman says that 20% of the legal complaints it receives relate to residential conveyancing. Chief Legal Ombudsman Adam Sampson said the improved housing market has driven the rise in the number of complaints, but said “I suspect there are a number of causes including procedural issues within firms and in some cases even fraudulent activity. Unfortunately, it is consumers who are paying the price”.

“Real problems getting basic information”

A recent case saw Sharon Harrison, an accountant from Warrington, landed with administration costs of £864 from her agents, and a £500 bill for an information pack, while delays have caused her to wait six months to complete the purchase and move in. She said “my solicitors have experienced real problems trying to get basic information out of the management company”.

The Conveyancing Association recommends that amendments to the Bill should include the introduction of fee capping, greater transparency, and fixed charges for administrative tasks. Other suggestions for the legislation include creating a role for a dedicated ombudsman, giving leaseholders an independent arbiter to go to with their complaints.

A need to squeeze out bad practice

Michelle Banks, the chief executive of the Association of Residential Managing Agents (ARMA), says that although the industry wants statutory regulation, in 2010 the government chose to pursue a different route, adding “Instead we are setting up a system of self-regulation, including a consumer charter. We agree there is a need to squeeze out poor practice”.

The Conveyancing Association itself already has measures in place to ensure that its agents follow protocols. Chairman Eddie Goldsmith says “The launch of the CA Pledges in 2012 and the launch of the CA Protocol in 2013 are but two examples of the initiatives we at the CA have undertaken to ensure that our members deliver the very best customer service possible – something that we as an association are deeply committed to”. ARMA also has a self-regulatory system, to be fully launched in January.

The Competition & Markets Authority is currently preparing a report on managing agents. A consultation period with leasehold homeowners is to end on Friday, September 19th, with the final report to be published in November.

Experts in leasehold and freehold property transactions

At IBB Solicitors, our residential conveyancing team is the largest in West London and surrounding Home Counties with a vast breadth and depth of experience in bespoke as well as standard conveyancing transactions. Our residential conveyancing solicitors provide professional legal advice on all aspects of buying and selling property.

We are also fully accredited and a member of the Law Society’s Conveyancing Quality Scheme – giving you absolute peace of mind that you are getting the best possible conveyancing service. We serve on the panels for all major mortgage lenders in the UK.

IBB’s team of property solicitors can advise on all aspects of buying, selling and mortgaging property. We are always happy to speak to you about the progress of your sale/purchase on the telephone at any time.

For more information or advice from our residential conveyancing solicitors in Buckinghamshire, call us today on 01494 790013 or 01494 790071 or email conveyancing@ibblaw.co.uk​.