Right To Manage: How To Gain Management Control Of Your Building

by Tim Bishop on March 2, 2014

If you live in a block of leasehold flats in the UK but don’t own the freehold, you may have experienced several problems over the years, whether it’s small things not getting fixed, the flats falling into disrepair, or simply trying to communicate with the landlord or managing agents when a reply is not forthcoming. You might even have issues with high service charges, especially if you can’t see the results of the money you pay in every month. It can be frustrating having so little control over the way the flats are managed – after all, it’s you who has to live there – but fortunately, there is something you can do about it, and it’s called Right To Manage (RTM).

What Is Right To Manage?

If you are a leaseholder of a flat and want to gain more control over how the building is run, you can exercise your Right To Manage and form a RTM company with other leaseholders in your block of flats. This means that, as a group, you will take over the main responsibilities in managing the property (how management fees are raised, where the money is spent, and so on), without having to depend on managing agents or landlords to get things done.

How Do You Set Up A Right To Manage Company?

You are able to achieve this level of management through the Commonhold and Leasehold Reform Act 2002 , as long as you set up a Right To Manage Company, and you can do this if you meet a few basic requirements:

o more than half of the leaseholders in the block of flats must support the idea of the RTM company

o two thirds of them must have leases that were initially for 21 years or over and

o at least 75% of the floor area must be used for residential purposes (not commercial).

As for actually setting up the RTM company, it is broadly the same as setting up a limited company. You can do this through Companies House or a legal specialist can guide you through the whole process. You will need to appoint a director – or directors – who will run the company on a day to day basis and be in charge of routine tasks such as repair work, paying for building insurance, and so on. Whatever you do, getting professional advice from solicitors with real expertise in right to manage work is a good idea.

Other Things To Note With RTM

You should be aware that setting up a Right To Manage Company will take some time and effort on your part, and you need to make sure that you are on the same page with the other leaseholders in your building – for example, who will be in charge of collecting management fees and who will pay the bills/sort out repairs? If you yourself (or someone in your building whom you trust) is in charge, you will no doubt feel better about where your money is going, and many Right To Manage Companies actually end up saving money. There are a lot of things to think about both in terms of practicalities and legal issues, so make sure you seek out advice from a solicitor with experience in this highly specialist area of property law.

Tim Bishop is senior partner of Bonallack and Bishop – solicitors who specialise in lease extension and right to manage company formation. For more information about RTM or lease extension, call them on 01722 422300 or visit their specialist websites at http://ww2.righttomanagecompanyuk.co.uk and http://www.leaseextensionuk.co.uk.

Tim Bishop
Having qualified as a Solicitor in 1986, Tim Bishop is a legal entrepreneur who owns leading law firm Bonallack & Bishop Solicitors. Find out why you should choose Bonallack & Bishop Solicitors: Visit www.bishopslaw.co.uk.
Tim Bishop

Previous post:

Next post: