The Right to Manage (RTM) has been around since 2022 as a way of allowing flat owners to take control of the management of their building without having to prove any fault of the landlord. As part of the Government’s commitment to reforming this area of law, parts of the Leasehold and Freehold Reform Act 2024 (the 2024 Act) have been introduced in piecemeal fashion since the start of 2025.
Several provisions relating to the RTM process have been brought into force as of 3 March 2025.
What are the main reforms to Right to Manage?
The most impactful change is to the qualifying criteria of a building because now a building that consists of up to 50% commercial units can qualify for RTM (whereas before the threshold was 25%). This change now allows flat owners who were previously unable to exercise the RTM of their building to take control of the management.
The Act also removes the landlord’s right to recover its legal costs from the flat owners which means landlords may be less likely to challenge RTM claims or obtain legal advice. This is positive in some ways but may make handover more challenging if a landlord is less likely to engage without professional advice.
The articles of association for an RTM company are prescribed by the Commonhold and Leasehold Reform Act 2002 but an amendment brought into effect by the RTM Companies (Model Articles)(England)(Amendment) Regulation 2025 waters down the voting rights of a landlord member and caps a landlords vote to 1/3rd of the votes exercised by the flat owner members thus capping a landlord’s influence over the management of the building.
Other important changes to Right to Manage
Other changes see the jurisdiction for disputes change from the County Courts to the First-tier Property Tribunal which will hopefully allow disputes to be determined quicker. Landlords are also prohibited from passing on non-litigation RTM costs to the flat owners via the service charge (which is a belt and braces approach to preventing landlords from recovering their legal costs from flat owners.)
For flat owners it is a positive step in allowing more buildings to qualify for RTM and we anticipate seeing more RTM claims be made whilst flat owners wait for the more extensive reforms to the purchase of freehold legislation. It will however mean that flat owners must assume more direct responsibilities for management by way of reserve funds, emergency repairs, building insurance and compliance with building safety legislation.
Service charge disputes may become more challenging and we may see the management of larger estates become separated and disjointed, which could have the overall effect of devaluing prestigious estates if one building were to fall into disrepair.
The future of Right to Manage
Only time will tell and it may be that in making the purchase of freehold legislation more accessible in the future by the introduction of the collective enfranchisement reforms in the 2024 Act, we will see more flat owners chose to purchase their freehold instead of exercise the RTM. For now however, it is a brave new world for flat owners who may for the first time be able to think about managing their own building.
How Moore Barlow can help
Dealing with landlords can be challenging, especially when navigating complex regulations. Our team is here to clarify your rights, handle negotiations on your behalf, and ensure that landlords meet their legal obligations. Whether you’re extending a lease or purchasing a property, we work to secure a fair and legally compliant agreement that protects your interests.
If you have any issues that you would like to discuss, including questions about Right to Manage, please get in touch with our Leasehold enfranchisement team.
