Right To Manage

A block may be managed by the freeholder, and managed well. But, it can also be managed by the tenants (leaseholders) should the freeholder pass over the management of it, or should the residents decide that the freeholder isn’t doing it right, and they need to take over. This is called a Right to Manage. Often, a Right To Manage Limited Company if formed, and its directors are the leaseholders of the block.

To discuss your block being able to undertake Right To Manage, please complete the form on the Contact Us Page.

This can also be done, where the leaseholder also holds a share of the freehold. A Right to Manage company is formed, and the leaseholders are directors.

Having a right to manage company, means that the directors of that company have the right to pick and choose which management company they use. This may be that one resident does it all themselves, and sorts the insurance, ground rent, service charge and maintenance issues. Or, it may be that they choose a Block Management Company (like us) to assist with doing all these things.

Right To Manage

What’s needed for Right To Manage?

If you’re a leaseholder, and not happy with how the block is being managed, there are things you can do. But, you can’t do it alone. There are certain legal rules and procedures that must be followed to ensure the block is suitable for Right To Manage. Here are a few:

  1. At least 2 thirds of the flats must be qualifying tenants – A ‘qualifying tenant’ is a leaseholder whose lease was originally granted for an original term of more than 21 years. The leaseholders don’t have to live in the block, and they can own as many flats as they want to.
  2. Blocks can be a mix of commercial and residential. But, the commercial area cannot exceed 25% of the total floor space when you exclude common areas.
  3.  The Landlord of a qualifying tenant cannot be a local housing authority.
  4. Right To manage cannot be undertaken where the premises fall within the Resident Landlord Exemption. To fulfil this exemption would require the following:
    • The premises must be other than a purpose-built block (for example, a converted house); AND
    • They must comprise not more than four flats; AND
    • One of the flats must be occupied by the freeholder or an adult member of their family as their only or principal home for the last twelve months.

I.e., in a house, converted to 4 flats where the landlords (freeholder) daughter (age 23) has lived in one of the flats for 14 months, Right To Manage cannot be undertaken.
However, in the same situation where there are 5 flats, it can.
Further, if the block is purpose built as a block of flats (and not a converted house) even with only 4 flats, and the Landlord lives on site, Right To Manage can be applied.

You will then the support of other tenants within the block* that the Right To Manage is to be applied. This is required that the minimum number of qualifying tenants MUST be equal to at least half the total number of flats in the building. In a block of 10 flats, at least 5 qualifying tenants must participate in the action to change to a Right To Manage company. If the block only has 2 flats, both must participate.

*For estates, where there are multiple blocks, each block must undertake its own Right To Manage action. You cannot mix up blocks across an estate.

How can we help you get the Right To Manage?

We can help you to take over the Right To Manage, and then manage on your behalf, should you wish. The tenants cannot take Right To Manage. It MUST be done by a company. The tenants may change over time, but the company will always be there.

We can form a limited company for you (Your Block Ltd) ensuring all the legal formalities are carried out. We would be the company secretary, and the participating tenants the directors.

Once formed, all tenants are entitled to be members of the company, and there is a space for the landlord as well, even if they don’t live in the block. This is a legal requirement. They do not need to participate, or take part, if they don’t want to, but they are legally entitled to a seat at the table.

Once the company has been set up, we can serve notice on all eligible tenants, inviting them to participate in the Right To Manage company.

There are then a few more steps to be legally undertaken before you have the Right To Manage. We can do all of these, ensuring that notices are served on landlords and tenants at the appropriate time, in the appropriate way.

No one know who the landlord is, or where they are?

When a landlord or a freeholder is absent, or cannot be traced, this creates a bump in the road, but not a blockage. We can use many different ways to trace the landlord, and serve notices on them. Or, if even we cannot find who the landlord is, we can go to the First Tier Tribunal with all our evidence of attempts to trace the landlord, and request that the Right To Manage company be allowed to take over the block.

We can assist with blocks gaining the right to manage across England. Please drop us an email to office@HastingsPropertyManagement.co.uk with a brief overview, and we’ll provide a quotation for our services.

If you’re interested in doing it all yourself, the Lease Advice Service have a great page full of information that can be found here.