Transparency to freehold homeowners who pay an administration charge on privately managed estates

This is a consultation on the exercise of the Welsh Ministers powers in the Leasehold and Freehold Reform Act 2024, in relation to Part 5 - Administration Charges as set out in Sections 83 to 87.

How to respond

Responses can be submitted by email, post or via an online form on the Welsh Government website. 

E-mail or postal responses should be sent to the address below to arrive by midnight on 12 March 2026. Please ensure you state “Consultation: Delivering transparency to freehold homeowners who pay an administration charge” in the subject line or header.

Further information and related documents

Large print, Braille and alternative language versions of this document are available on request.

Contact details

For further information:

Social Housing Regulator and Strategic Business Division
Welsh Government
Cathays Park
Cardiff
CF10 3NQ

Email: leaseholdreform@gov.wales

Mae’r ddogfen yma hefyd ar gael yn Gymraeg / This document is also available in Welsh: Sicrhau tryloywder i berchnogion tai rhydd-ddaliad sy'n talu taliadau gweinyddu | LLYW.CYMRU

The Welsh Government will be a data controller for any personal data you provide as part of your response to the consultation. Welsh Ministers have statutory powers they will rely on to process this personal data which will enable them to make informed decisions about how they exercise their public functions. Any response you send us will be seen in full by Welsh Government staff dealing with the issues which this consultation is about or planning future consultations. Where the Welsh Government undertakes further analysis of consultation responses then this work may be commissioned to be carried out by an accredited third party (e.g. a research organisation or a consultancy company). Any such work will only be undertaken under a contract. Welsh Government’s standard terms and conditions for such contracts set out strict requirements for the processing and safekeeping of personal data.

In order to show that the consultation was carried out properly, the Welsh Government intends to publish a summary of the responses to this document. We may also publish responses in full. Normally, the name and address (or part of the address) of the person or organisation who sent the response are published with the response. If you do not want your name or address published, please tell us this in writing when you send your response. We will then redact them before publishing.

You should also be aware of our responsibilities under Freedom of Information legislation. If your details are published as part of the consultation response then these published reports will be retained indefinitely. Any of your data held otherwise by Welsh Government will be kept for no more than three years.

Your rights

Under the data protection legislation, you have the right:

• to be informed of the personal data held about you and to access it
• to require us to rectify inaccuracies in that data
• to (in certain circumstances) object to or restrict processing
• for (in certain circumstances) your data to be ‘erased’
• to (in certain circumstances) data portability
• to lodge a complaint with the Information Commissioner’s Office (ICO) who is our independent regulator for data protection.

For further details about the information the Welsh Government holds and its use, or if you want to exercise your rights under the UK GDPR, please see contact details below:

Data Protection Officer:
Welsh Government
Cathays Park
CARDIFF
CF10 3NQ

e-mail: Data.ProtectionOfficer@gov.wales

The contact details for the Information Commissioner’s Office are: 

Wycliffe House
Water Lane
Wilmslow
Cheshire SK9 5AF

Tel: 01625 545 745 or 
0303 123 1113

Website: https://ico.org.uk/

The Leasehold and Freehold Reform Act 2024 (“the 2024 Act”) introduces new rules to give homeowners and leaseholders more rights and protections.

This consultation is part of the package of work to implement Part 5 of the 2024 Act, which will give homeowners on privately managed estates new rights, protections and powers to hold their estate manager to account for the money they spend. This framework is built around the rights currently enjoyed by leaseholders and includes ensuring transparency of estate management charges, giving homeowners the right to challenge the reasonableness of their charges, and allowing these homeowners the right to apply to a tribunal to appoint a manager in the event of serious management failure. 

The majority of the regulation making powers in Part 5 of the 2024 Act vest in the Secretary of State and there are a small number of powers which are to be exercised by the Welsh Ministers in relation to Wales. This consultation seeks views on proposals in relation to “administration charges” connected with estate managers in Wales. 

The Secretary of State is consulting on proposals which will shape the new regime in both England and Wales and you can share your views on those elements (with the exception of administration charge proposals, which are England only) here: https://www.gov.uk/government/consultations/enhanced-protections-for-homeowners-on-freehold-estates

In this document 

• “Estate manager” refers to both resident management companies[1] (RMCs) and embedded management companies[2] (EMCs), or other bodies of persons which carry out, estate management and which recover the costs through relevant obligations.
• “Homeowner” means anyone who has a freehold or leasehold interest in a house or flat and who is obliged to pay an administration charge.
• “Appropriate tribunal” refers to a Leasehold Valuation Tribunal in Wales (or the First-tier Tribunal in England).

This consultation deals with the new rules around the transparency of any administration charges connected with estate management charges which homeowners are obliged to pay, as set out in Sections 83 to 87 of the 2024 Act. When all the provisions in Part 5 are commenced, and secondary legislation is made, a new regulatory framework applicable to the payment of an administration charge in connection with the estate management charges will be in place. 

We would like to hear your views on our proposals, and your feedback will inform secondary legislation about the form and contents of the administration charge schedule.

1. Residential developments require amenities like roads, sewers, drainage, and open spaces. Relevant authorities, such as highways authorities and water companies, often “adopt” amenities on new developments as a matter of course, so that they are maintained at public expense. Over recent years, we have witnessed the growth of private management on housing estates where some or all of the shared infrastructure is not maintained by the relevant authorities and instead the costs of their ongoing maintenance falls upon the homeowners of the estate by virtue of the terms of their home ownership. This arrangement gives rise to what is known as an “estate management charge”. The payment of an “estate management charge” is in addition to the council tax. The Competition and Markets Authority’s (CMA) 2024 report into the housebuilding industry estimated the average estate management charge in Great Britain in 2022 to be £358 per annum, but with a wide range depending on the circumstances of individual estates[3].
    
2. A Welsh Government consultation on estate charges in 2020[4] received over 600 responses, including from 566 homeowners and residents, eight developers and a number of management companies, local authorities, letting agents and property lawyers. From this it appeared that the annual amount paid in estate charges by residents in Wales varied from £50 to £500, with most in the region of £100-150.
    
3. Prior to the 2024 Act there was no regulatory framework in place to manage costs and hold estate managers to account. Homeowners had few rights and for some their only power was to apply to the county court on the ground of a breach of contract. This approach was, and remains, costly and time-consuming. Even homeowners living on estates run by resident management companies face difficulties because they still had limited influence and could find it hard to obtain the information they needed about their charges or obtain redress when things went wrong. 
    
4. Part 5 of the 2024 Act gives homeowners new statutory rights and protections to hold estate managers to account for the money they spend, and to seek redress when they consider charges to be unreasonable.

5. Currently, there are very few legal requirements on estate managers, beyond those set out on property deeds, to be transparent in the charging and demanding of estate management charges and to provide information to homeowners.
    
6. Homeowners, under the terms of property deeds, will typically receive a bill for the provision of services for the maintenance and upkeep of communal areas on estates. The frequency of bills and the information provided alongside them depend on the terms set out in the property deeds and, beyond that will be a matter for the estate management company. The same applies to requests for information to help homeowners understand what they are paying for. 

7. Sections 83 to 87 of the 2024 Act create a new regulatory framework surrounding the payment of an administration charge. These are the charges which an estate manager may levy, in addition to the estate management charge, for dealing with specific requests (such as undertaking property alterations or subletting). Section 83(1) of the 2024 Act defines the type of requests or circumstances which may give rise to an administration charge. Section 83(2) clarifies that the definition of 'administration charge' does not include amounts payable by a tenant of a dwelling where specific conditions are met. This provision is intended to expressly exclude 'event fees', which are commonly used in the retirement housing sector Sections 86 and 87 of the Act, when commenced, will require that all administration charges must be reasonable and can be challenged at the appropriate tribunal, this will be the Leasehold Valuation Tribunal in Wales.
    
8. Section 83(3) of the 2024 Act gives the Welsh Ministers a regulation making power to amend the definition of ‘administration charge’. Our starting position is that the definition does not need to be changed at this time, and we propose to keep it under review. We would welcome your views on this position.

83 Meaning of “administration charge”

(1) For the purposes of this Part, “administration charge” means an amount payable, directly or indirectly, by an owner of a dwelling—

(a) for or in connection with—

(i) the grant of approvals in connection with a relevant obligation, or

(ii) applications for such approvals;

(b) for or in connection with the provision of information or documents by or on behalf of an estate manager;

(c) for or in connection with—

(i) the sale or transfer of land to which a relevant obligation relates, or

(ii) the creation of an interest in or right over that land;

(d) in respect of a failure by the owner to make a payment by the due date under a relevant obligation;

(e) in connection with a breach (or alleged breach) of a relevant obligation.

(2) But “administration charge” does not include an amount payable by a tenant of a dwelling in a case where all of the following conditions are met—

(a) the tenant’s lease specifies that only a person who has attained a minimum age may occupy the dwelling;

(b) the amount is payable under a term of the tenant’s lease or is otherwise payable in connection with the tenant’s lease;

(c) the amount is payable if—

(i) the tenant’s lease is granted, assigned or terminated,

(ii) a lease of the dwelling which is inferior to the tenant’s lease is granted, assigned or terminated, or

(iii) there is a change in the person or persons occupying the dwelling;

(d) the amount is fixed or is calculated by a method determinable in advance;

(e) any other conditions specified in regulations made by the appropriate authority.

(3) The appropriate authority may by regulations make provision (including provision amending this Act) so as to amend the definition of “administration charge”.

(4) A statutory instrument containing regulations under this section (whether alone or with other provision) is subject to the affirmative procedure.

9. Section 84 of the 2024 Act introduces a new requirement on estate managers, who expect to charge an administration fee, to publish an administration charge schedule showing the administration charges that individual homeowners may be liable to pay. Alternatively, if an exact amount of a charge cannot be provided up front in the schedule, the method by which the amount is to be calculated is instead to be included. Estate managers may revise a published schedule and if they do so must publish it. Under section 86, estate managers are not able to require payment of charges until 28 days after the revised schedule setting them out is published. This will increase the transparency of administration charges for homeowners, enabling them to be better informed on administration charges they may face and allowing them to be better informed if they wish to challenge administration charges they feel are unreasonable. 
    
10. Later in this consultation, we propose that the administration charge schedule should be sent to homeowners annually and at any point charges are updated, or on request. For this reason, we do not propose that regulations should specify how charges should be published. This will not prevent charges from being published via a website or other suitable means. 

11. We believe that the new administration charge schedule should be clear, easy to understand and detailed enough to inform homeowners about potential costs they will be charged for over the year ahead. Standardising the form and content of the administration charge schedule will seek to set a minimum level of detail to be included, rather than limit what information is provided. Estate managers are able to choose to provide more detail if they wish. We would like to get views on the minimum level of information and detail that should be provided on the new administration charge schedule.
     
12. The proposed form and content of the administration charge schedule is contained at Annex A. As required by section 84(2) of the 2024 Act it sets out fixed costs where an exact cost can be provided and information on how an amount will be calculated, if the exact cost is not known. 

13. We propose that the administration charge schedule, should at a minimum be provided annually. We note the UK Government propose in their consultation that the administration charge schedule should be included in the annual report (which is required under section 79 of the 2024 Act). We proposal for annual provision would allow for the administration charge schedule to be provided in this way, if desired. Additionally, we propose that where an estate manager revises their administration charge schedule, it should be provided to the homeowner separately. We also propose that the administration charge schedule should be provided to homeowners at any time on request. 
     
14. Estate managers should provide the administration charge schedule in an accessible format. We consider that estate managers may provide this information electronically but should also do so by post, if this is requested or is the preference of the homeowner.
     
15. We are also considering whether the schedule should also be provided to purchasers during the conveyancing process. 

16. The following section and questions are for estate managers and managing agents only. We are interested in any costs which are directly associated with the implementation of the requirement for administration charge schedules.
     
17. We recognise that the cost of these new requirements will affect estate management companies and managing agents differently, depending on the systems they have in place currently and the extent to which information on charges is already provided.
     
18. We want to understand how this new requirement will affect businesses and we also recognise that to prepare for the new arrangement, a transition period, to update IT systems, train staff or adjust their processes to meet the new requirements for example, may be needed.
     
19. We want the transition period to be as short as feasible and propose that 12 months would be appropriate. However, we would welcome views on a suitable transition period that would be appropriate to prepare for the new requirement for administration charge schedules. 

TEMPLATE: ADMINISTRATION CHARGE SCHEDULE 

All estate managers (and managing agents) must complete this form if they expect to charge an administration charge. This form must be provided to homeowners annually, and on request, as well. All estate managers (and managing agents) must update and provide this form to homeowners more than 28 days before new charges come into effect. A failure to comply with these requirements will allow a homeowner to apply to the appropriate tribunal, which can award damages of up to £1,000. 

Question 1

Does the definition of administration charge need to be changed at this time? Yes/No

If YES provide details [Free text]

Question 2

Section 83(2) sets out conditions which, if met, mean that a charge will not be an administration charge. Can you think of any other conditions which if met should result in an amount payable by a homeowner not being an ‘administration charge’? 

Provide details [Free text]

Question 3

Do you think it is necessary to specify how an administration charge should be published, if regulations specify that homeowners should be sent the schedule annually, and at any point the charges are updated? [Yes/No]

If no, how do you consider the administration charge schedule should be published? [Free text]

Question 4

Do you agree with proposals to standardise the form and content of the administration charge schedule as set out at Annex A? [Yes/No] 

Question 5

Can you think of any additional information that should be included in Annex A [Yes/No]

If yes, what changes do you consider necessary? [Free text]

Question 6

Do you think the administration charge should be issued to homeowners annually? [Yes/No]

If no, how often should it be issued? [Free text]

Question 7 

Do you think the administration charge schedule should be made available by post and/or electronically? [Yes/No] 

If no, please explain [Free text]

Question 8 

Do you think estate managers should make the administration charge schedule available on request, in addition to annually and when revisions have been made? [Yes/No] 

If no, please explain [free text]

Question 9

Do you think the administration charge schedule should be made available to prospective buyers as part of the conveyancing process? [Yes/No]. 

Please explain if there are any issues or concerns with this approach [Free text]

Question 10

Are there any other situations when you think estate managers should be able, or be required, to provide the administration charge schedule to homeowners? Provide details [Free text] 

Question 11 

Estate managers and managing agents only: Would you need to make significant adjustments to your systems to meet the new administration charge schedules requirement? [Yes/No/Not sure] 

If yes, would any adjustments be outsourced (for example, to an IT software provider)? [Free text]

Question 12

Estate managers and managing agents only: How much would it cost you (or, if outsourced, the provider) in terms of set up costs to adjust systems to collect and provide the information proposed in the administration charge schedule and thereafter additional ongoing costs? 

Please provide a breakdown of both set up/one-off costs which may be required and any additional costs of providing the information which may be on an ongoing basis, after set up. [Free text]

Question 13

Estate managers and managing agents only: Do you think a 12-month period is an acceptable transition period to prepare for the new administration charge schedule requirement? [Yes/No/Not sure] 

If no, what should be an appropriate period and why? [Free text]

Question 14 

What, in your opinion, would be the likely effects of the proposals on the Welsh language? We are particularly interested in any likely effects on opportunities to use the Welsh language and on not treating the Welsh language less favourably than English. 

Do you think that there are opportunities to promote any positive effects?

Do you think that there are opportunities to mitigate any adverse effects?

Question 15 

In your opinion, could the proposal be formulated or changed so as to:

• have positive effects or more positive effects on using the Welsh language and on not treating the Welsh language less favourably than English; or
• mitigate any negative effects on using the Welsh language and on not treating the Welsh language less favourably than English?

Question 16 

We have asked a number of specific questions. If you have any related issues which we have not specifically addressed, please use this space to report them:

Please enter here: [Free text]

Question 17

If you are responding on behalf of an organisation/or not as a homeowner where are the properties that you deal with located? Tick all that apply:

1. England
2. Wales
3. Other (please state) 

Question 18

 If you are responding on behalf of an organisation: 

1. How many staff members do you employ? [Number]
2. How many estates are you responsible for? [Number]
3. What is the total number of homes on the estates that you manage? [Number]

Question 19 

If you are responding as an individual, are you a:

1. Homeowner
2. Landlord  
3. Legal representative
4. Other (please specify). [Free text]

Question 20 

What, in your opinion, would be the likely effects of the proposals on the Welsh language?  We are particularly interested in any likely effects on opportunities to use the Welsh language and on not treating the Welsh language less favourably than English. 

• Do you think that there are opportunities to promote any positive effects?
• Do you think that there are opportunities to mitigate any adverse effects?  

Question 21 

In your opinion, could the proposal be formulated or changed so as to:

• have positive effects or more positive effects on using the Welsh language and on not treating the Welsh language less favourably than English; or
• mitigate any negative effects on using the Welsh language and on not treating the Welsh language less favourably than English?

Question 22 

We have asked a number of specific questions. If you have any related issues which we have not specifically addressed, please use this space to report them:

Please enter here: [Free text]

Responses to the consultation may be published. Your response will be anonymous.

However, if you would like your name to be published alongside your response, please tick the box.

I agree to my name being published alongside my response to this consultation.

[1] RMC - Residents’ Management Company. A not-for-profit company incorporated by a housing developer to own and manage the shared facilities and public amenities on a new-build housing estate

[2] EMC - appointed by the housebuilder to manage parts of new-build housing estates. The embedded MC is made party to the transfer deed. Source: Housebuilding Market Study Final Report, February 2024 - Glossary

[3] Competition and Markets Authority – Housebuilding market study – final report (February 2024) – Paragraph 3.80. 

[4] Welsh Government Written Statement: Publication: Summary of responses to the call for evidence on estate charges (November 2020).

[5] Items with an * are provided by way of example. The administration charge schedule should be populated with the relevant costs applicable to the particular property or estate which it is provided in relation to