Nearly three and a half million British households live in their leasehold flats, managed under a service charge arrangement with a managing agent.
Managing agents go by many names: property managers, building managers, block managers, estate managers, but they all – by and large – do a similar job. They manage multi-occupancy buildings – low rise and high-rise blocks of flats – or estates. Their duties include everything from building maintenance to keeping shared areas and spaces clean and tidy. In more recent years, since the Grenfell Tower tragedy, they have also taken on an increasingly complex set of tasks around building safety. As it stands right now, however, anyone could set themselves up as a managing agent – no qualifications, no experience, no oversight.
Residents are at the coalface of dealing with their managing agents. They pay a service charge so that day-to-day work on their buildings gets addressed in a timely manner (think everything from cleaning the hallways to fixing the roof to dealing with complex building fire and safety compliance issues).
Over the last few years there has been growing disquiet from leaseholders, that I and my colleagues have witnessed through our parliamentary inboxes, with concerns about managing agents – mainly relating to increased service charges, but also about service failures and delays, and value for money.
Whilst many managing agents operate in the right and proper way, sadly, there are still far too many who do not.
And whilst many do operate in a good way – supported with best practice and training by organisations like The Property Institute (the managing agent sector’s professional body) – the actions of the rogue and unscrupulous managing agents, as well as those who need to urgently pull their socks up and do a better job, are overtly impacting the reputation of the wider industry. There is a cross-party consensus that we need to root out the bad apples, but the question is, how?
Why statutory regulation is now unavoidable
I find it chilling that you, me, or anyone else could set up as a managing agent tomorrow.
Multi-occupancy buildings are getting ever-more complex, and managing agents are taking on gravely serious responsibilities – at its most acute; the lives, welfare and safety of those people who live within the buildings they manage.
That’s why I’m pushing for the statutory regulation of managing agents and an Independent Regulator of Managing Agents through my Private Member’s Bill. This would mean that these individuals and companies must be trained, competent, qualified and registered to be able to operate – all things that stakeholders, including the profession itself, have been campaigning on for many years. Indeed, my colleagues in the Labour for Leaseholders group have rightly been holding the sector’s feet to the fire to improve the way it delivers for residents. And this Private Member’s Bill is to complement – not take away from – the continuing work that the Government are doing to make good on Labour’s promise of sweeping leasehold reform prior to the last General Election, through the Draft Commonhold and Leasehold Reform Bill which is currently working its way through parliament.
Of course, one remedy of regulation will be to see off the poor practice that blights some leaseholders, but it also goes far beyond that- to the very core of ensuring the safety and wellbeing of those that live in these buildings.
Regulation will have a small cost, but that is a price worth paying and after all, the costs of failure are often even higher – legal fees, wasted time pursuing redress and extortionate fees on failed services.
Whilst regulation may not currently be in vogue, due to the necessity to secure growth urgently – it’s not hard to argue that the leaseholder product has been damaged commercially by the failure of the sector of managing agents. A focused regulator can provide much needed reassurance to consumers, a boost to sales and, ultimately, housebuilding as a result.
We regulate airlines, financial markets, dentists, and food hygiene standards – so why would we not want to regulate a sector that is about the safety of where millions of our friends, family and neighbours call home?
If you’re interested in supporting my Private Member’s Bill, why not take a moment to write to your local MP to give your views? You can find your MP’s contact details here.
Would you like to write for Red Brick? Email rose.grayston@gmail.com to pitch your piece (c.600-900 words)