At Cadmus Property, we believe in empowering flat owners with the knowledge and tools they need to manage their properties effectively. One of the key ways to achieve this is through forming a Right to Manage (RTM) company. But what exactly is an RTM company, and why might it be the right choice for you?
What is a Right to Manage (RTM) Company?
A Right to Manage (RTM) company is a legal entity that allows leaseholders within a block of flats to take over the management of their building from the landlord or a third-party managing agent. Introduced under the Commonhold and Leasehold Reform Act 2002, this option provides flat owners with the ability to directly control the maintenance, upkeep, and services within their building.
RTM is a powerful tool that gives leaseholders the authority to make decisions about the day-to-day management of their property, from arranging repairs and maintenance to selecting contractors and managing budgets. This means that instead of relying on the landlord or external management companies, the people who live in the building have a direct say in how it’s managed.
Benefits of Forming an RTM Company
1. Increased Control: One of the most significant advantages of forming an RTM company is the increased control it gives leaseholders over the management of their building. This includes everything from choosing service providers to setting service charge budgets.
2. Cost Efficiency: With an RTM company, leaseholders can often achieve cost savings by negotiating directly with contractors and service providers, eliminating any mark-ups that might be added by third-party management companies.
3. Better Quality of Service: Leaseholders are usually more motivated to ensure that the management of their building is handled efficiently and to a high standard, as they have a vested interest in maintaining the value and comfort of their homes.
4. Transparency: Forming an RTM company brings greater transparency to how funds are managed and spent. Leaseholders can ensure that every penny of the service charge is used appropriately and effectively.
5. Flexibility: RTM companies offer flexibility in decision-making, allowing residents to respond quickly to issues and needs as they arise.
Is My Building Eligible for RTM?
Not every block of flats qualifies for RTM, so it’s important to check eligibility before proceeding. The main criteria include:
· At least two-thirds of the flats must be owned by qualifying leaseholders.
· The building must contain at least two flats.
· At least 50% of leaseholders must agree to participate in the RTM company.
· The building must be a self-contained unit, with no more than 25% of the space used for non-residential purposes.
If your building meets these criteria, you’re well on your way to gaining more control over your property.
How Cadmus Property Can Help
At Cadmus Property, we are dedicated to helping flat owners navigate the complexities of forming an RTM company. From understanding your eligibility to guiding you through the legal process, our experienced team is here to support you every step of the way. We also work with leading solicitors in London to ensure that every aspect of the process is handled professionally and in compliance with the law.
Stay tuned for our next blog post, where we’ll dive into the step-by-step process of forming a Right to Manage (RTM) company, ensuring you have all the information you need to take this important step towards managing your own property.
If you have any questions or would like more information on RTM companies, don’t hesitate to contact our team at Cadmus Property. We’re here to help you take control of your building and create a better living environment for everyone involved.
By Kalam Elias (MTPI & AssocRICS)
Cadmus Property Team
