A section 20 notice is expected — what will the major works cost me?

A section 20 notice is expected on the building

Nobody can tell you yet, and that is the problem rather than an evasion. A section 20 notice is the consultation a landlord must carry out before major works, and the consultation is what establishes the cost. An expected notice means the works are coming and the figure is not yet fixed — so you are being asked to commit to a share of a bill that has not been quoted.

From the e-ROT archive

This scenario is drawn from Report on Title material dealing with this specific circumstance.

Lexsure master Report on Title paragraph: S20 Notice of Works to Leaseholder · See the wording

What the notice actually is

Section 20 of the Landlord and Tenant Act 1985 requires a landlord to consult leaseholders before carrying out major works, and limits what can be recovered from each leaseholder if the consultation is not carried out properly. It is a protection, not a bill.

The consultation runs in stages: notice of intention, then estimates, then notice of the award. The practical effect for a buyer is that a notice which has only been anticipated carries no number at all, and a notice at the estimates stage carries a number that may still move.

Why the figure matters more than the notice

Your share is set by the apportionment in your lease, not by negotiation, so the question is what proportion of a total you do not yet know. Roof works, lift replacement and external redecoration are the recurring large items, and on a block of any size the per-flat figures run into thousands.

Two things narrow the uncertainty before exchange. The management pack and the service charge accounts show what has been spent historically and whether a reserve fund has been building up against the works. And the managing agent can usually say which stage the consultation has reached, which tells you how firm any figure is.

What it does to the transaction

It is a negotiating point. Where a cost is anticipated but unquantified, buyers commonly ask for a retention or a price adjustment, and sellers commonly resist on the basis that the figure is unknown — which is the same fact used both ways.

It also follows the flat. An expected section 20 notice can deter your buyer or their lender when you come to sell, exactly as it may be giving you pause now. That is not a reason to walk away; it is a reason to know what is coming and to have priced it.

S20 Notice of Works to Leaseholder

Master precedent Lexsure e-ROTScope Notice anticipated within two yearsWord count 62Status Current master paragraph

A Section 20 notice is a legal requirement for landlords to consult with leaseholders before undertaking major works on a building. In this case, the notice is expected in relation to { specify nature of work eg roof work’} for the building. This is a common practice to ensure transparency and allow leaseholders the opportunity to provide input on the proposed works. …

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