London Mayor Sadiq Khan is being urged to introduce a cap on rocketing leasehold service charges in the capital.

Members of the London Assembly want Khan to limit fees for new shared-ownership homes. London is particularly affected, as over a third (36%) of the capital’s homes are leasehold, compared to only 16% in the rest of England.

A new report from the Assembly’s Housing Committee calls for the Mayor to include “designing down service charges” as part of his updated London Plan.

Key recommendations

A committee survey found that leaseholders spend an average of £3,912 per year (£326 per month) on service charges, with one in 10 (11%) spending over £7,000 per year

And key recommendations in the report include that the Mayor should work to improve transparency in leasehold service charges in London.

The GLA (Greater London Authority) should conduct research on caps to service charges in its new-build shared ownership.

Londoners are being hit hard by increasing service charges.”

Sem Moema, Deputy Chair of the London Assembly Housing Committee, says: “Londoners are being hit hard by increasing service charges, often with no clear idea of what they are receiving in return for their money.

“We are calling on the Mayor to do his part, by capping service charges on new shared ownership homes and committing to drive down service charges through his new London Plan.”

Ruled out

In April, Housing Minister Matthew Pennycook ruled out a cap on leasehold service charges.

He told MPs a ceiling on service charges would prevent funds being raised for legitimate reasons, and the Government could not prevent that.

Hamptons said earlier this year that the average annual service charge for a flat during 2024 increased by 11% to £2,300 or £192 a month.

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