My flat has a Section 20 major works bill. Can I sell?

What is a Section 20 notice?

A Section 20 notice is the formal warning a freeholder or managing agent must give leaseholders before carrying out major works. It comes from section 20 of the Landlord and Tenant Act 1985. The rule is a spending threshold, not a project size: if qualifying works would cost any single leaseholder more than £250 including VAT, the landlord has to consult before going ahead.

Qualifying works means repair, maintenance or improvement to the building. Roof replacement, external redecoration, window renewal, lift works and structural repairs are the common ones. A separate threshold of £100 a year per leaseholder applies to qualifying long term agreements, such as a multi-year maintenance contract.

If the landlord does not consult properly and the tribunal does not excuse the failure, they cannot recover more than £250 per leaseholder for the works. Wales has its own equivalent arrangements, so check the rules that apply to your building.

Do I have to tell my buyer about it?

Yes. The leasehold information form you complete when selling asks directly about notices, proposed works and anticipated expenditure, and your answers form part of the contract. Withholding a live Section 20 notice is not a risk worth taking: your buyer's solicitor requests a management pack from the freeholder or managing agent, and the notice, the estimates and the reserve fund position are all in it.

Disclosing early also protects your timetable. A buyer who learns about a major works bill in week two has time to price it in. A buyer who learns about it in week ten, after a mortgage offer and a survey, is far more likely to renegotiate hard or walk away.

Who actually pays the major works bill?

In law, the person who owns the flat when the service charge demand is validly served is the one liable, subject to the terms of the lease. In practice the parties agree the split before exchange, because neither side wants to gamble on when a demand lands. There are three usual outcomes.

A retention is the most common route when a consultation is still running, because nobody knows the final number. A retention is a sum held by the solicitors from the sale proceeds, released once the true cost is confirmed, with any balance returned to you. It protects the buyer without asking you to hand over money you may not owe.

Do not agree a figure against an estimate range. Get the managing agent's latest written number first, then negotiate against something real.

What should I do if a Section 20 notice lands mid-sale?

1. 1. Tell your solicitor and your agent the same day

   Both of them need to know before your buyer's solicitor raises it, so the conversation happens on your terms rather than as a late discovery.

2. 2. Get the actual figure in writing from the managing agent

   Ask for your flat's apportioned share, the current estimates, the expected timetable and the reserve fund balance. A negotiation against a range always costs the seller more than a negotiation against a number.

3. 3. Check whether a reserve fund already covers part of it

   Many blocks hold a sinking fund built up from past service charges. Money already in that fund reduces what any leaseholder has to find, and buyers rarely think to ask.

4. 4. Use your consultation rights while you still own the flat

   You have at least 30 days to make observations at the notice of intention stage and again on the estimates, and you can nominate a contractor. If the charge looks unreasonable, the First-tier Tribunal in England can rule on whether a service charge is reasonable and payable.

5. 5. Propose a retention before the buyer proposes a discount

   Going first with a fair mechanism keeps the number tied to the real cost. Waiting usually invites an opening offer set at the top of the estimate range.

6. 6. Match your own spending to the buyer's commitment

   Lining up your solicitor early is cheap and keeps the sale moving. Larger outlays, and coming off the market entirely, are worth holding until the buyer has instructed and paid their own solicitor and applied for their mortgage.

Will a major works bill stop my flat selling?

Usually not, once it has a number on it. Buyers and lenders treat a known, quantified major works liability as an ordinary part of buying a leasehold flat. What genuinely frightens a buyer is an open-ended one: a notice with no estimates, a managing agent who will not answer, or a seller who seems to be hoping nobody asks.

The wider flat market is already slower than the house market, so anything you can do to remove doubt is worth doing early. A flat that comes to market with the notice disclosed, the apportioned figure attached and a proposed retention already suggested reads as a well run sale. That is a different proposition from the same flat with a surprise in week ten.

How do I keep control of this?

Decide your position before you are asked for one. Know the figure, know the mechanism you prefer, and know the lowest net proceeds you would accept.

A seller who has done that is negotiating. A seller reading a Section 20 notice for the first time on a solicitor's email is reacting.

It also pays to know how different agents would handle it. ValuQ gives UK homeowners free, side-by-side property valuations from competing local estate agents, so you can see what several agents in your area think your flat is worth, and how each would present a live major works consultation to buyers, before you speak to any of them.