RTM Hub
Right to manage (FAQ )
What is right to manage (RTM)
The Right to Manage (RTM) scheme was introduced in 2002 and gives you – as a leaseholder – the legal right to set up a company with other leaseholders and take over the management of your building. It means you become responsible for organising everything to do with the property, from repairs and new carpets to buildings insurance and light bulbs.
Permission from the landlord is not required. And you don’t need to prove that the landlord or the management company has handled matters badly.
Does our block qualify?
- Your block must contain at least two flats.
- The building must be self-contained.
- At least two-thirds of the flats in the building must be owned by long leaseholders (leases of more than 21 years when first granted).
- At least half of the flats in the building, held by long leaseholders, must agree to the RTM for it to happen.
Does it apply to me?
What could stop us having RTM?
- If 25% of your building is non-residential e.g. retail or industrial, you don’t qualify for RTM.
- If there is a resident landlord i.e. the freeholder of the whole building lives in one of the properties, you may not qualify for RTM.
Can we have one RTM for numerous blocks?
- No. The right to manage operates on a building by building basis. So an estate with several blocks will need to have a separate RTM for each block.
What are the costs involved?
- There are two costs involved in setting up an RTM: administrative costs and landlord costs.
- To administer and oversee your RTM process, we charge an amount per flat and a one off fee.
- We can offer you a quote by enquiry from the Contact Us tab.
Setting up an RTM?
What if the landlord/freeholder objects?
When a notice is served to a landlord, occasionally (but rarely) they will issue a counter notice, denying the leaseholders the right to take over management of the block on a specific date.
If this happens, the RTM company has the right to take its case to the First Tier Tribunal-Property to help progress the RTM process. Your right to manage company would incur the cost of booking the case with the Tribunal and paying any legal costs incurred.
What if other tenants in my block object?
As long as at least half of the flats in the building, held by long leaseholders, agree to the RTM, it can proceed.
How long does the process take?
In most cases an RTM application, from the moment you contact Houston Lawrence to the moment you take over management of your block, takes about five to seven months from start to finish.
It may take longer if the landlord decides to contest your RTM application. It’s important to get advice from the beginning of the process to reduce the risk of this happening.
How we can help?
We have helped numerous block and estates set up an RTM company. And we’re happy to do this for you free of charge, on the understanding you appoint Houston Lawrence as you’re managing agent when the RTM company is formed.
How we help.
- Giving advice on taking the first steps towards an RTM.
- Contacting other residents to inform them about RTM and building support for a move away from the current management company and landlord/freeholder.
- Referral to an independent lawyer to manage the legal aspects of setting up an RTM. (or is this done in house?)
- Helping you set up an RTM company and giving advice on director responsibilities.
- Negotiating with the freeholder over the terms of your management takeover and the date it will happen.
Benefits of having RTM
Making key decisions
You and the other directors of the RTM company can decide how much your service charge should be, what repairs are carried out and when, what major works need to be done, and which suppliers to use.
Choose your own managing agent
Most RTMs will appoint a managing agent like Houston Lawrence to ensure supplier invoices are paid, health and safety requirements are met, and any accounting and company secretary duties are handled efficiently. You and the other directors choose the management agency you want and the level of service you require.
Reduced service charges
Almost certainly your service charges will be less. With RTM you can choose the suppliers you want to work with and avoid paying spurious administration fees.
Better representation regarding estate changes
If you live on an estate, having an RTM puts you in a better position to challenge estate charges. With an RTM you have a collective voice and someone who will represent your view and position.
Making your home more sellable
Potential buyers are often concerned about potentially large service charges. Knowing there’s an RTM in place where tenants manage their own service fees, makes your property a more attractive proposition.
Snagging list dealt with more efficiently
If you’ve recently bought a new build, any snags will be dealt with more quickly. Rather than having the frustration of dealing with the developer or freeholder yourself, your RTM will deal with them on your behalf.