RTM : Right to Manage

The provisions of the Commonhold and Leasehold Reform Act 2002 has brought into force a new   Right to Manage, or RTM, which enables leaseholders of flats, subject to qualifying rules, to take over collectively the management duties of the building without having to prove fault on the part of the freeholder or pay any compensation. This allows leaseholders to have a greater degree of control over the level of service charges set and the option to appoint their own managing agents and select insurers.

In circumstances where residents and lessees are experiencing problems with their existing landlord and find themselves unable to resolve matters this legislation now presents leaseholders with a solution. By setting up an RTM company they can, under certain qualifying arrangements, collectively take control of the management of the block.

Importantly there is no need for leaseholders to prove any wrongdoing on the part of the existing freeholder or management company however there is a need to meet the qualifying criteria for the property and leaseholders as described below.

If the premises meets the following criteria then leaseholders should be able to acquire the Right to Manage or RTM :-
• The premises must be a structurally detached building or self-contained part of a building.
• The premises must have at least two flats.
• At least two-thirds of the flats in the premises must be owned by “qualifying tenants”.
• If part commercial the non-residential part of the premises must not exceed 25% of the total
floor area.
• At least 50% of the leaseholders in the premises must be in agreement to proceed.
• The local housing authority is not the landlord of any qualifying tenant.

The timescale for the process is governed by statute as each step must allow for the statutory
timeframe. An uncontested RTM application will take between five and six months. For the agreed fee VFM will undertake to set up all the legal procedures and serve the required legal notices, including the notice of claim on the landlord advising that leaseholders will be exercising their statutory right to manage, and any subsequent request for information from
the landlord in respect of validating the Notice of Claim.

Throughout the process, we can help clarify requirements by assisting and advising leaseholders wishing to consider this option. By co-ordinating efforts between leaseholders and their solicitors we can provide support and guidance through the somewhat complex legal procedures involved.

We are experienced and qualified property managers and can also manage your building following your Right to Manage claim.