An investigation by WHICH? and Urban Owners (Managing Agent) has revealed that some leaseholders are being overcharged for insurance and service charges. The examples given were as follows:-
1. Insurance - Some Agents were found to be overcharging for insurance suggesting that they have been given hidden 'kickbacks' for putting all of their business in one place.
2. New builds - Some leaseholders in new developments were found to have been paying for repair work which should, ordinarily, have been remedied by the Developer.
3. Unlawful fees - some Managing Agents were charging fees that they had no right to levy in accordance with the terms of the lease.
4. Repairs - some Managing Agents were found to have been paying over the odds for repair work so as to take advantage of 'kickback's or referrals.
5. Incompetence - in some cases, Managing Agents have been found to have been slack about carrying out work even though clearly within the terms of their retainer.
The above mentioned organisations have called for a change in the law to force Managing Agents to be more transparent about their charges. ARMA (Association of Residential Managing Agents) have supported the above and believe that the industry should be more strictly regulated.
If you are a leaseholder experiencing problems as outlined above then your first action should be to complain to the Managing Agent. You can challenge the charges via the Leasehold Valuation Tribunal too. Alternatively, you could join with the other leaseholders in the block and consider exercising your "Right to Manage" or "Collective Enfranchisement". If you have any queries on leasehold matters generally then please contact our expert in this field, Hayley Samuels on 01708 784020.