“To the millions of leaseholders across the country, you have my word. The days of you being squeezed for every penny are coming to an end,” Andy Burnham told the Labour party conference. Only a few hours earlier, his housing secretary, Angela Rayner, had announced that the government would legislate for a new independent regulator and launch a consultation to cap “rip off” administrative fees. While these are undoubtedly steps in the right direction, they are miles away from Labour’s manifesto promise to “finally bring the feudal leasehold system to an end”.
In its modern form, leasehold in England and Wales turns homes into income streams for freeholders. It should be abolished. There are powerful vested interests – billionaires, aristocrats and big businesses – that would oppose this move. But the system of service charges is crippling the housing market because its exorbitant cost puts off prospective buyers. The average annual service charge for a flat in England and Wales is now £2,405, up 32.6% since 2020 and 55.6% over a decade. Owners of flats in high-rise blocks in London are paying service charges of more than £7,000 a year. Little wonder that first-time buyers are increasingly bypassing flats.
