Forming a right to manage (RTM) company is usually the end of a long process: getting enough qualifying leaseholders on board, serving the claim, waiting out any objection period. Once it lands, though, a new board is suddenly responsible for things a previous landlord or managing agent used to just deal with, often with very little handover documentation to go on. This article covers what actually changes on day one, and what is worth lining up first.
What the right to manage actually transfers
Under Part 2, Chapter 1 of the Commonhold and Leasehold Reform Act 2002, an RTM company formed by qualifying leaseholders can take over the landlord’s management functions for the building, without having to show any fault on the landlord’s part and without needing the landlord’s agreement, provided the qualifying conditions set out in the Act are met. This is a summary, not legal advice: if you are part way through a claim or unsure whether your building qualifies, take advice from a solicitor who deals with leasehold enfranchisement before relying on anything here.
What transfers, broadly, is responsibility for managing the common parts and the services the lease requires: repairs, servicing and the day-to-day running that a landlord or their agent used to handle. What does not change is the lease itself. Ground rent, if any, and enforcement of most tenant covenants generally stay with the landlord unless the RTM company’s articles say otherwise. Again, get your own advice on where that line sits for your specific lease.
What to line up before day one, if you can
- A record of what condition the common parts are actually in, ideally before responsibility transfers rather than after
- Whoever previously handled repairs, and any outstanding jobs that were mid-way through
- A single point of contact leaseholders can report faults to, so reports do not scatter across several board members’ inboxes
- A rough sense of what planned work is coming: redecoration cycles, servicing due dates, anything flagged in a recent survey
Boards that get this wrong tend to inherit a backlog of deferred maintenance with no paper trail explaining what was already known about it. That is a poor starting position for a volunteer board answering to leaseholders. The earlier you get a written record of what the common parts need, the earlier you can start showing leaseholders a plan rather than reacting to complaints.
Running the building day to day afterwards
Once the RTM company is managing, the shape of the job is the same as for any freeholder or RMC: reactive repairs reported to one place and closed out, planned maintenance booked before something fails, and quoted works going to the board in writing before anything is instructed, so a decision can be minuted. Inspections of the common parts, recorded on a schedule, give a new board something to show leaseholders who ask what is being done.
We cover that day-to-day side in more depth in our article on block management for RMCs and freeholders, including how larger works get consulted on under the Landlord and Tenant Act 1985 once a job crosses the statutory threshold. That applies to an RTM company the same way it applies to any other body responsible for the service charge.
Spreading the workload across a volunteer board
Most RTM boards are made up of leaseholders doing this alongside their own jobs, not full-time managers. A single point of contact for repairs, and a contractor who appoints and manages the trades rather than the board having to find and chase them individually, takes a genuine amount of that workload off a small group of volunteers. Reporting is put in writing at each stage specifically so it can be handed between board members as people rotate on and off without the history getting lost.
If your building is part way through the claim rather than already managing, or you are weighing up whether RTM is the right route at all, that is a decision for your own solicitor, not for a maintenance contractor. What we can help with, once the decision is made and the company is formed, is the practical side: getting a written record of the building’s condition and a working point of contact in place from day one.
Talk to us about your building
The consultation, the site visit and the written quote are free and carry no obligation. If your RTM company has recently taken over, or is about to, see the full detail on our property management page, or request a free quote and tell us where things stand.