What is Right to Manage?
Right to Manage was introduced by the Commonhold and Leasehold Reform Act 2002 to give leaseholders a straightforward way to take charge of how their building is run. Crucially, it is a 'no-fault' right: you do not have to show the freeholder or managing agent has done a bad job.
RTM transfers management functions, not ownership. The freeholder keeps the freehold and continues to receive any ground rent, but the day-to-day decisions about maintenance, repairs, insurance, service charge budgets and which managing agent to use pass to an RTM company controlled by the leaseholders.
It is often the first step leaseholders consider when they are unhappy with service or costs, because it is usually quicker and cheaper than buying the freehold (a process called collective enfranchisement).
Right to Manage vs buying the freehold
Two different ways to gain more control of your building.
| Feature | Right to Manage | Buying the freehold |
|---|---|---|
| What you gain | Control of management | Ownership of the freehold |
| Need to prove fault? | No | No |
| Pay the freeholder a price? | No purchase price | Yes, a premium for the freehold |
| Ground rent | Still payable to freeholder | Effectively ends for participants |
| Typical cost | Lower, mainly legal and setup | Higher, includes the freehold premium |
| Complexity | Moderate | Higher |
RTM is usually faster and cheaper; buying the freehold gives fuller, permanent control.
Does your building qualify?
The main qualifying conditions for RTM are broadly:
- The building is a self-contained block of flats, or part of one that can be managed independently.
- At least two-thirds of the flats are held by qualifying long leaseholders.
- At least 75% of the building's floor area is residential (not commercial).
- Enough leaseholders join the RTM company, generally at least half of the flats.
- It is not excluded, for example certain converted buildings with a resident landlord.
How the Right to Manage process works
The route from frustration to control, in outline:
1. Check eligibility
Confirm the building and leaseholders meet the qualifying conditions before spending money.
2. Set up an RTM company
Form a company limited by guarantee that other qualifying leaseholders can join as members.
3. Invite participation
Serve a notice inviting all qualifying leaseholders to take part, then recruit enough members.
4. Serve the claim notice
Serve a formal claim notice on the freeholder setting out the intention to take over management.
5. Handle any counter-notice
The freeholder can dispute eligibility via a counter-notice; if so, the First-tier Tribunal decides.
6. Take over management
On the acquisition date the RTM company takes control of management and can appoint its own agent.
You still pay ground rent
Right to Manage transfers management, not ownership, so any ground rent in your lease remains payable to the freeholder. If your goal is to end ground rent entirely, buying the freehold or extending the lease may be more appropriate.
Get the notices right
RTM is procedural, and mistakes in the qualification check or the formal notices can derail a claim or hand the freeholder grounds to object. Most groups use a solicitor experienced in leasehold to prepare the notices and run the timetable.