The Advantages & Disadvantages of Right To Manage

18 September 2015

Right To Manage (RTM) was introduced under the Common-hold and Leasehold Reform Act 2002. It gives leaseholders the power to improve the management standards of their block. RTM allows leaseholders to have a number of services collectively in managing their block, namely selecting contractors and service providers, setting budgets and service providers, and even selecting a managing agent to undertake all such management matters on their behalf. This process is straight forward, but what are the advantages of Right To Manage?

According to the website, there are quite a few advantages. First of all, RTM does not have to show fault on the existing’s landlord or managing agent’s part to succeed. Whether the leaseholders choose to step in and take over or the property has been historically mismanaged, the RTM process allows leaseholders to acquire the management of their block or property without having to worry about proving why. RTM also gives leaseholders, upon successful completion of the process, the power to take full control of the running of the property. This can mean that the RTM company can decide what management strategy to employ and have the ability to see how and where funds are spent, as they have a vested interest in the smooth operation of the block or property. Also, the RTM company also has the freedom to elect and agree the service levels with the chosen managing agent, allowing leaseholders to come to the final decision as to who manages the property, rather than allowing the landlord to appoint another agent and giving them freedom on how to manage the property.  This often results in large cost savings within the service charge.

But are there any disadvantages to RTM? Right To Manage does require at least one director, and the director’s task in managing a property may become more of a challenge than at first thought. The website mention that the director would have to deal with maintenance and repairs liaisons with tenants, and this can prove time-consuming and stress-inducing. It may even result in conflicts with tenants. On other sites, it is repeatedly warned that the director of Right To Manage companies, especially when it comes to block management in London, may not have the easiest time in managing the issues usually handled by the landlord. Of course, the RTM company can hand these tasks over to a managing agent thereby freeing the director of the work.

RTM can present some challenges, but the advantages evidently do outweigh the disadvantages. It is the best option to go for when people want to manage the needs of their property instead of leaving it to the landlord. The benefits of Right To Manage seem to greatly aid leaseholders and helps them in improving their block or property.