The Right to Manage (RTM) is a legal right granted to leaseholders of an apartment block that allows them to take over the management of their building from the current managing agents or landlord. Introduced under the Commonhold and Leasehold Reform Act 2002, RTM gives leaseholders the power to form a company that will be responsible for managing the day-to-day operations of their building.
Definition and Explanation
RTM is a process that empowers leaseholders by giving them control over the management and maintenance of their building. By exercising RTM, leaseholders can collectively decide how their building is managed, who provides services like maintenance and repairs, and how service charges are spent. This can lead to better service quality, more transparency, and potentially lower costs.
Legal Framework
RTM is enshrined in law through the Commonhold and Leasehold Reform Act 2002, which sets out the specific rights and procedures for leaseholders to acquire management responsibilities. Unlike other legal processes, such as buying the freehold, RTM does not require the leaseholders to prove that the current management is inadequate or problematic. It is a right that can be exercised as long as certain conditions are met.
Eligibility Criteria
To qualify for RTM, the following conditions generally need to be satisfied:
The Building: Must be a self-contained building or part of a building, with at least two flats.
Leaseholders: At least 50% of the flats in the building must be held by qualifying leaseholders who wish to participate in the RTM process.
Residency: At least two-thirds of the flats must be held on long leases (typically more than 21 years).
Exclusions: Buildings where more than 25% of the floor area is non-residential (e.g., commercial space) are typically not eligible for RTM.
By meeting these criteria, our apartment block is eligible to pursue RTM, which would allow us to take charge of our building’s management. This process is a powerful tool for leaseholders seeking greater control and better management of their living environment.