Leasehold System – New rules on the timing and costs of providing replies to management enquiries…
New rules on the timing and costs of providing replies to management enquiries when a leasehold property is sold
I have written previously about recent proposals to reform the law as it relates to long residential leases in England & Wales.
One of the slightly less headline grabbing proposals is a cap on the fees that landlords and managing agents can charge when providing information in the context of a sale. A great deal of useful information, relevant to a flat sale, is controlled by the landlord and/or their managing agent and there is a standard list of enquiries – the LPE1 – that a buyer’s solicitor will use to obtain this information. However, there are no useful controls on how much can be charged to provide this information, nor any requirement for timeliness, which often means that a sale is held up by delays caused by a relatively disinterested party. To add insult to injury, the quality /business/of the information that is eventually delivered is often somewhat lacking.
In an attempt to improve the position, there are proposals afoot to limit the fee payable for the preparation and supply of this information to £200.00 (fees of more than twice this sum are not uncommon), and to require it to be delivered within three weeks of being requested. Some commentators have predicted that the position will worsen as a consequence of the proposed new requirements, but as a practitioner in this area I know that a well-run firm of managing agents or a diligent landlord will have most of the requisite information to hand, and should be able to provide it in a timely and efficient way so that a £200.00 fee is adequate payment for their services.