A Housing Forum Good Practice Guide Sustainable Leasehold and Long-term Asset Management 19 Ensuring successful recovery of expenditure for major works Social landlords often fail to recover legitimate costs from leaseholders, for a variety of reasons. This may be because they fail to follow the correct procedures for major works under Section 20 of the Landlord and Tenant Act, or because they are undercharging for management administration fees and service charges, which means that the time they spend recovering expenditure from leaseholders is being subsidised by tenants. It is worth remembering that the relationship between the landlord and the leaseholder is a commercial one and should be considered as such. Here are a few areas where social landlords can find themselves out of pocket. Poor accounting for works and services As an example, major repair works are complex and take time to deliver. Many landlords feel that because of the length of time involved and the complexity, items which should be charged to the leaseholders often get absorbed by the landlord. To stop this happening, landlords need a clear understanding from the outset of what is chargeable and what is not chargeable. This will require an understanding of the repair covenants in the lease. Once the understanding is developed, a very detailed system of data recording and management needs to be put in place. This includes strict adherence to the correct service of notices, formal communication channels and a clear and well-defined recovery mechanism. Gosport Towers, Hampshire, Hyde Housing, supplied by Martin Arnold
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