Leasehold Advice
Right to Manage Explained
Right to Manage lets the leaseholders in a block take over its management from the freeholder. This guide looks at what it gives you, whether your building qualifies and how the process works.
The Basics
Right to Manage, almost always shortened to RTM, is a statutory right that lets the leaseholders in a block take over the management of their building from the freeholder. It comes from the Commonhold and Leasehold Reform Act 2002, and its great strength is that it is a no-fault right: the leaseholders do not have to prove the freeholder has done anything wrong to use it.
The leaseholders set up a company between them, the RTM company, and once the process is complete that company runs the building: it handles the service charge, the repairs, the buildings insurance and the choice of managing agent. What RTM does not do is hand the leaseholders ownership of the building. The freeholder keeps the freehold. This guide explains what RTM gives you and what it does not, whether your building qualifies, how the process runs and how an RTM affects a sale.
This guide describes the law in England and Wales. Right to Manage is a feature of the leasehold system in England and Wales and does not apply in Scotland or Northern Ireland.
What Right to Manage Is, and What It Is Not
Right to Manage is often misunderstood, usually because people expect it to do more than it does. It is worth being precise about where it starts and stops.
What transfers
When an RTM claim completes, the RTM company takes over the management functions set out in the lease. In practice that means the things that affect day-to-day life in the block: setting and collecting the service charge, arranging repairs and maintenance, arranging the buildings insurance and appointing or dismissing the managing agent. The leaseholders, through their company, are now the ones in charge of how the building is run and who runs it. For the wider picture of the roles in a block, see our guide on how your block is managed.
What does not transfer
RTM does not give the leaseholders ownership of anything. The freeholder still owns the freehold, can still sell it and still receives the ground rent. The leases stay exactly as they are. RTM also does not deal with lease extensions: if your lease is getting short, extending it is a separate process and still involves the freeholder, even after an RTM is in place. And it does not touch the ground rent, which carries on under the lease as before.
The no-fault point
The single most useful feature of RTM is that it does not depend on the freeholder having failed. The leaseholders do not have to prove neglect, overcharging or breach. If the building qualifies and the process is followed, the right is acquired. That makes RTM a realistic option for a block where the management is simply mediocre or unresponsive, not only for one where things have gone badly wrong. Where the managing agent is the specific problem, our guide on dealing with a difficult managing agent covers the shorter-term options alongside RTM.
Does Your Building Qualify
Not every block can use Right to Manage. The qualifying conditions are set out in the 2002 Act, and they are about the building and the leaseholders rather than about the freeholder.
The building
The building has to be a self-contained building, or a self-contained part of a building that could be redeveloped independently. Any non-residential part, such as shops or offices on the ground floor, must not be more than 50 percent of the total internal floor area. That 50 percent limit is recent: the Leasehold and Freehold Reform Act 2024 raised it from 25 percent on 3 March 2025, which brought a lot of mixed-use buildings into scope for the first time, flats above shops being the common example.
The leaseholders
At least two-thirds of the flats in the building have to be held by qualifying tenants. A qualifying tenant is, broadly, a leaseholder on a long lease, meaning a lease that was originally granted for more than 21 years. This is about the length of the lease when it was first granted, not how many years are left on it now, so a flat sold on a 99-year or 125-year lease still counts as being on a long lease even if it has run down to a short remaining term. What the test is really there to exclude is flats let on short residential tenancies rather than sold long-leasehold. Then, to actually make the claim, the RTM company has to have members who are qualifying tenants of at least half the flats in the building. So a small, uninterested minority cannot block it, but you do need real support from your neighbours: an RTM is a collective effort, not something one leaseholder can do alone.
The exclusions
A few buildings are outside the scheme. The main one to know about is a small converted building, with no more than four flats, where the freeholder or an adult family member lives in one of the flats and has done since before the conversion. Buildings with a local authority landlord are also handled differently. If you are unsure whether your building qualifies, the Leasehold Advisory Service is a good first port of call.
How the Process Works
The RTM process is a sequence of formal steps with set notice periods. It is not difficult in principle, but it is exacting: the notices have to be right, because a defective one can send you back to the start.
The steps
First, the leaseholders set up the RTM company, a company limited by guarantee with the prescribed form of articles. Next, the company serves a notice inviting participation on any qualifying tenants who are not yet members, giving them the chance to join. Then the company serves the formal Claim Notice on the freeholder and anyone else with management responsibilities under the lease. The freeholder has a set period to respond with a Counter-Notice. If they do not dispute the claim, management transfers on a date set in the notice. If they do dispute it, the matter goes to the First-tier Tribunal, which decides whether the qualifying conditions are met.
Timescales
An undisputed claim usually takes several months from forming the company to the handover, often in the region of three to six months, because the statutory notice periods build in waiting time that cannot be shortened. A disputed claim that goes to the tribunal takes longer. Getting the paperwork right first time is the single biggest thing within your control.
Who pays the costs
This is an area that improved recently. Before 3 March 2025, the leaseholders making the claim, through the RTM company, had to pay the freeholder's reasonable costs of dealing with it, whether the claim succeeded or not, which was a real deterrent. Since that date, each side generally bears its own costs. The RTM company is only liable for the freeholder's costs in limited situations, mainly if the claim is withdrawn or the company has acted unreasonably, and not for tribunal costs. Lease clauses that tried to pass these costs to leaseholders are now void. The leaseholders still have their own costs to plan for, setting up the company and any professional help with the notices, but the bill is no longer weighted against them.
Right to Manage and Selling Your Flat
If your building already has an RTM company, or you are thinking about one, it is worth knowing how it sits with a sale.
An RTM in place is usually a positive
A buyer looking at a flat in a block run by an RTM company is looking at a building the leaseholders control. For many buyers that is reassuring, because it means the people running the block are the people who live in it. The practical mechanics of the sale do not change much: the management pack your conveyancer needs comes from the RTM company or its managing agent rather than from the freeholder, and the buyer's solicitor asks the same questions they would of any block: the service charge accounts, the reserve fund, the buildings insurance.
A claim that is mid-process
The situation that needs a bit of care is selling while an RTM claim is under way but not yet complete. The management is in transition, which is not a problem in itself, but it is something a buyer's solicitor will want explained. If your building is part way through a claim when you come to sell, tell your conveyancer early so they can set it out clearly for the buyer's side rather than having it surface as a surprise.
When the management is the reason you are selling
Some people sell because the building is badly run and they have had enough. RTM is the longer-term fix for that, but it takes months and needs your neighbours on board, so it is rarely a quick answer for someone who wants out now. If a poorly managed building is the reason you want to sell and you do not want to wait, a sale to a cash buyer is the route least affected by management problems, since a cash buyer can take a view on the block as it stands.
Further Reading
Two related guides cover the management side: the roles that run a block, and what to do when the managing agent is the problem.
Frequently Asked Questions
Right to Manage, usually shortened to RTM, is a statutory right that lets the leaseholders in a block take over the management of their building from the freeholder. It comes from the Commonhold and Leasehold Reform Act 2002. The leaseholders set up a company, the RTM company, and once the process is complete that company takes on the management functions: the service charge, repairs and maintenance, buildings insurance and the choice of managing agent. It does not transfer ownership of the building, and it does not require the leaseholders to prove the freeholder has done anything wrong.
No, you do not. This is the feature that makes Right to Manage useful. It is a no-fault right: the leaseholders do not have to show mismanagement, neglect or any breach by the freeholder. If the building meets the qualifying conditions and the process is followed correctly, the right is acquired regardless of how well or badly the building has been run. That is what separates RTM from the older route of applying to the tribunal for a manager to be appointed, which does depend on proving fault.
No. This is the point most often misunderstood. Right to Manage transfers the management of the building, not its ownership. The freeholder still owns the freehold, can still sell it, and still receives any ground rent. What changes is who runs the building day to day: the RTM company takes over the management functions, but the leases, the freehold and the ground rent are untouched. If the leaseholders want to own the building, that is a separate process called collective enfranchisement, which means buying the freehold.
It does not. Ground rent is a payment under the lease to the freeholder, and Right to Manage does not change the lease or the freeholder's ownership, so the ground rent carries on exactly as before. The RTM company runs the building, but it does not collect the ground rent and cannot reduce or remove it. Getting rid of ground rent is done through a lease extension or by buying the freehold, not through RTM.
The main tests are these. The building has to be a self-contained building or a self-contained part of one. At least two-thirds of the flats must be held by qualifying tenants, meaning leaseholders on long leases, broadly those originally granted for more than 21 years rather than short tenancies. Any non-residential part, such as shops on the ground floor, must not be more than 50 percent of the internal floor area, a limit raised from 25 percent by the Leasehold and Freehold Reform Act 2024. And to make the claim, the RTM company needs the participation of leaseholders representing at least half the flats. A few buildings are excluded, such as small converted buildings with a resident landlord and no more than four flats.
For a straightforward claim that the freeholder does not dispute, several months is typical, often around three to six months from forming the RTM company to the handover. The statutory notice periods build in a set amount of waiting time, so it cannot be rushed. If the freeholder disputes whether the qualifying conditions are met and the matter goes to the First-tier Tribunal, it takes longer, and the timescale then depends on the tribunal. The process rewards getting the paperwork right first time, because a defective notice can mean starting again.
This changed on 3 March 2025. Before then, the leaseholders making the claim, through the RTM company, had to pay the freeholder's reasonable costs of dealing with it, win or lose. Since that date, each side generally bears its own costs. The RTM company is only liable for the freeholder's costs in limited situations, mainly if the claim is withdrawn or the RTM company has acted unreasonably, and not for tribunal costs. Lease clauses that tried to make leaseholders pay these costs are now void. The leaseholders still have their own costs to budget for, such as setting up the company and any professional help, but the change removed a significant deterrent.
Not on the merits. A freeholder cannot refuse Right to Manage on the basis that they would rather keep managing the building, or that they think they do it well. The only thing they can dispute is whether the building and the claim actually meet the qualifying conditions, and they do that by serving a counter-notice. If they serve one, the First-tier Tribunal decides whether the right exists. A freeholder can slow a claim down by disputing it, but if the conditions are met they cannot stop it.
An RTM company that is up and running is usually a neutral to positive point on a sale. It tells a buyer the leaseholders control the building, and the management pack simply comes from the RTM company or its managing agent rather than from the freeholder. A buyer's solicitor will ask the same questions they would of any block: the service charge accounts, the reserve fund, the buildings insurance. The one situation that needs care is a claim that is mid-process when you come to sell, because the management is in transition. If your building is part way through an RTM claim, tell your conveyancer early so it can be explained properly to the buyer.