South Devon MP Caroline Voaden has warned the shadowy practices of residential estate management companies could prove to be “the next great scandal of our time”, following the unmitigated disaster of the privatised water industry.

Leading a Westminster Hall debate on this issue, Ms Voaden outlined how every type of resident is affected by rogue management companies, with both leaseholders and freeholders dismissed, intimidated and fleeced.

Comparing the practices to the water industry, she noted that these companies are not subject to regulation, and are often owned by overseas investors, who eat up smaller players in the market, and build up their wealth and size so they can ride roughshod over anyone who questions their methods or asks where their money has gone.

During the debate, Voaden drew on research from the Commons Library.

Of the over 1,100 people who responded to relevant petitions on this issue, 94 per cent said they were unhappy or very unhappy with the services provided by their management company.

The same percentage (94 per cent) said their service charges were unfair, with shoddy workmanship, delayed repairs, broken lifts, and leaking ceilings cited as common complaints.

This is an issue pertinent to South Devon. Since her election, Caroline has met with FirstPort, one of the largest estate management companies in the country, and, during the debate, discussed the challenges Totnes residents of Camomile Lawn are facing, where service charges have risen far beyond inflation.

At Camomile Lawn, residents were told the annual contribution to a reserve fund had been increased from £2,000 to £8,000 per year, a 265 per cent increase.

Service charges also increased by 23 per cent, based on a 10-year plan that was not shared with residents. Accounting costs also went up by 55 per cent in one year with no explanation.

This is a pattern, Voaden noted, that is being repeated across the country.

To fix the issue, the Liberal Democrat MP urged the government to consider ending the practice of shared ownership of public spaces for the vast majority of new developments.

She also asked the Minister for a timeline for the Leasehold and Commonhold Reform Bill, and when the government will bring forward legislation to allow freeholders to challenge management charges.

Reflecting on the debate, Caroline Voaden, MP for South Devon, said:

“As a new MP, I realised there would be some issues that would only be pertinent to South Devon, but when I reached out to colleagues to see who else was dealing with casework about estate management companies, I was taken aback by the response I got.

“Tales of intimidation, excessive charges, and poor services span the length and breadth of our country, and without government action, I fear we’re facing the next great scandal of our times.

“It is way past time management companies were required to act responsibly, to treat residents with respect, and provide timely, straightforward, accessible information to all residents.

“This issue isn’t solely about money. It’s about how people feel living in a home they may have put their life’s savings into buying. Homes that are sold as offering ‘peace of mind’ should deliver that; instead, many face the opposite.”