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UK Labour Party: Property Management Companies Face Ban

Property management companies would be banned from operating in England and Wales if they persistently ripped off leaseholders under plans being considered by Labour.

Lisa Nandy, the shadow housing secretary, is looking at proposals to clamp down on the sector amid complaints from leaseholders about escalating fees and essential maintenance being left undone.

The plans, which have not yet been completed, are under consideration as part of a wider package to overhaul the current leasehold system, including bringing an eventual end to leaseholds altogether.

During a Commons debate on Tuesday, Nandy called the practices of some property managing agents “a scandal hiding in plain sight”. Her backbench colleague Emma Hardy added: “There is no one regulating these companies. They’re accountable to no one – even members of parliament find it very difficult to hold them to account for their bad practice.”

About 10 million Britons own their homes through leasehold and have to pay extra charges for ground rent, service fees and leasehold extensions.

Michael Gove has promised to end what he called the “feudal” leasehold system. Still, The Guardian revealed those plans had been watered down earlier this month after Downing Street decided they would be too difficult to enact before the next election.

Ministers said on Tuesday they intended to cap ground rents and ban property owners from charging leaseholders extortionate fees to fulfil simple requests.

Labour said it would enact a “phased” end to the system if elected next year, including a ban on new developments sold as leaseholds, scrapping any issued after 2017 and eliminating more historical versions in the longer term.

In the meantime, the party also plans to clamp down on the service companies that maintain properties on behalf of owners.

Labour sources told the Guardian the party was looking at a system that would mirror the licensing regimes it had already promised for landlords and agents in the rented sector.

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