Right to Manage UK: How Leaseholders Can Take Over Building Management (2026 Guide)

The Right to Manage gives leaseholders the legal power to take control of their building's management without paying compensation to the freeholder, without proving mismanagement, and without going to a tribunal. If your building qualifies, you and your neighbours can set up an RTM company under the Commonhold and Leasehold Reform Act 2002 and transfer management responsibilities to yourselves — or to a managing agent of your choosing.

Does your building qualify for the Right to Manage?

Before taking a single step, check the qualifying criteria under CLRA 2002, as amended by the Leasehold and Freehold Reform Act 2024:

Building type: The premises must be a self-contained building or self-contained part of a building containing at least two flats held by qualifying leaseholders. Houses are excluded — RTM applies to flats only.

Leasehold threshold: At least two-thirds of the total number of flats in the building must be held on long leases (originally granted for a term exceeding 21 years).

Participation threshold: At least 50% of the qualifying leaseholders must participate in the RTM company. In a four-flat building, you need at least two leaseholders; in a twenty-flat building, you need at least ten.

Residential use: No more than 25% of the internal floor area (excluding common parts) may be in non-residential use. A building with a ground-floor commercial unit exceeding this threshold does not qualify.

Freeholder residence: The building qualifies even if the freeholder lives in one of the flats, unlike the older collective enfranchisement rules. This is a deliberate feature of RTM — it is a no-fault right.

What is the step-by-step RTM process?

The process has a defined statutory sequence. Deviation from it — including serving notices in the wrong order or using incorrect prescribed forms — can invalidate your claim.

Step 1 — Form the RTM company. Incorporate a private company limited by guarantee at Companies House. The company name must include the words "RTM" or "Right to Manage" and the building's address. Articles of association must comply with the model prescribed by the RTM Companies (Model Articles) (England) Regulations 2009. Company registration costs £12 online.

Step 2 — Invite participation. Once the RTM company is formed, you must invite all qualifying leaseholders who are not already members to join, using a prescribed invitation notice. You must allow at least 14 days for them to respond before serving the claim notice.

Step 3 — Serve the Claim Notice. The RTM company serves a formal claim notice on the freeholder (and any intermediate landlord) using the prescribed form under section 79 of CLRA 2002. The notice must state the date on which the RTM company intends to acquire the right to manage — this must be at least three months after the date the notice is given.

Step 4 — The counter-notice period. The freeholder has one month from the date of the claim notice to serve a counter-notice either admitting the claim or alleging that the RTM company does not have the right to manage. If no counter-notice is served, the right to manage is acquired automatically.

Step 5 — Tribunal application (if challenged). If the freeholder serves a counter-notice disputing the claim, the RTM company can apply to the First-tier Tribunal (Property Chamber) for a determination. Tribunal proceedings add time and cost, but the freeholder cannot simply veto a valid claim.

Step 6 — Acquisition date. Three months after the claim notice was served (assuming no counter-notice dispute, or upon a successful tribunal determination), management transfers to the RTM company. The RTM company must then manage the building in compliance with the terms of all the leases.

What are the costs of claiming the Right to Manage?

RTM is designed to be accessible. The principal costs are:

• Company incorporation: £12 at Companies House online.
• Solicitor fees: Typically £1,500–£4,000 for an uncontested claim, covering the claim notice and transfer documentation. Contested claims can cost considerably more.
• Freeholder's reasonable costs: Under section 88 of CLRA 2002, the RTM company must pay the freeholder's reasonable costs of the RTM process — typically £500–£2,000 for an uncontested claim. This is the only payment required and it cannot be used to block the claim.
• Ongoing management costs: Once you acquire the right, you are responsible for appointing a managing agent or self-managing. Budget for service charge accounting, buildings insurance procurement, maintenance management, and Companies House annual filings.

What changes — and what does not — when RTM is acquired?

Management transfers to the RTM company, but ownership does not. The freeholder retains the freehold. Leaseholders retain their individual leases. The RTM company steps into the shoes of the landlord only for management purposes — it collects service charges, organises maintenance, manages communal areas, and appoints contractors.

The RTM company does not acquire the right to grant new leases, extend existing leases, or make structural alterations to the building. Those rights remain with the freeholder. If you want to pursue lease extension or collective enfranchisement (buying the freehold), those are separate statutory processes under the Leasehold Reform, Housing and Urban Development Act 1993.

The freeholder retains the right to be consulted on major works under Section 20 of the Landlord and Tenant Act 1985 — this obligation transfers to the RTM company, not away from it.

How does the Leasehold and Freehold Reform Act 2024 affect RTM?

The Leasehold and Freehold Reform Act 2024 made the following changes to the RTM process, effective from commencement dates being phased in during 2025–2026:

• Costs reform: The 2024 Act abolishes the requirement for RTM companies to pay the freeholder's costs in uncontested cases in England (though this provision had not fully commenced as of mid-2026 — check current commencement orders).
• Non-residential limit raised: The commercial floor area exclusion threshold has been raised, allowing more mixed-use buildings to qualify.
• Group RTM: Leaseholders in multiple buildings on an estate can form a single RTM company to manage all buildings collectively, reducing administrative burden.
• Improved tribunal routes: Streamlined procedures for disputed claims at the First-tier Tribunal.

What are the most common pitfalls that invalidate an RTM claim?

Procedural errors are the most frequent reason RTM claims fail. The most common pitfalls are:

Incorrect company articles. Using generic company limited by guarantee articles instead of the prescribed RTM model articles causes the company to be invalid as an RTM company.

Serving the claim notice before the invitation notice period expires. You must wait the full 14 days after the invitation notice before serving the claim notice on the freeholder.

Missing leaseholders from the process. Failing to identify all qualifying leaseholders and serve them with the invitation notice can be challenged by the freeholder.

Underestimating participation numbers. If participation drops below 50% before acquisition date (because a leaseholder sells and the new owner does not join), you may need to restart the process.

Not accounting for the three-month buffer. Some RTM companies name an acquisition date that is too close to the notice date, creating a procedural defect. The acquisition date must be at least three months after the claim notice date — not three months from formation of the RTM company.

FAQ

Can the freeholder refuse the Right to Manage?

The freeholder cannot simply refuse a valid RTM claim. They may serve a counter-notice within one month alleging that qualifying criteria are not met, but if the RTM company's claim is valid, the First-tier Tribunal will determine in their favour. The RTM is a no-fault, no-consent right — the freeholder's objection can only succeed if the company has failed to meet the statutory requirements. A well-prepared claim with legal advice at the outset makes a successful counter-notice very unlikely.

What happens to ongoing service contracts when management transfers?

Existing contracts for services — cleaning, maintenance, buildings insurance — transfer to the RTM company under the provisions of CLRA 2002. The RTM company inherits both the benefits and obligations of those contracts. You are entitled to review and renegotiate them, but you cannot simply cancel contracts without following their termination provisions. The previous managing agent must hand over all management records, financial accounts, and documentation within a reasonable time.

Does RTM affect the freeholder's right to manage their own flat?

If the freeholder occupies one of the flats as a leaseholder, they are entitled to join the RTM company as a member. Their membership rights are the same as any other leaseholder. However, their status as freeholder — with the associated rights to receive ground rent, enforce lease covenants, and grant consents — is not affected by RTM. The separation of management and ownership is a fundamental feature of the right.

Can an RTM company appoint a professional managing agent?

Yes — and in most cases this is sensible. The RTM company holds management responsibility legally, but it can contract with a professional managing agent (ARMA or IRPM-qualified) to carry out the day-to-day management. The RTM company directors remain legally responsible for compliance with the leases, LTA 1985 service charge rules, and health and safety obligations — the managing agent acts on their instructions. Choose a managing agent who understands RTM-specific requirements, as the governance structure differs from a conventional landlord-and-managing-agent relationship.

How does Right to Manage differ from collective enfranchisement?

RTM transfers management only — you control how the building is run but do not own the freehold. Collective enfranchisement under the Leasehold Reform, Housing and Urban Development Act 1993 transfers ownership of the freehold to a residents' company, which then holds both management and ownership rights. Enfranchisement requires a formal valuation, payment to the freeholder at a statutory price, and typically costs significantly more. RTM is faster, cheaper, and requires no payment for the right itself — making it the more accessible starting point for leaseholders seeking greater control.

Editorial note: This guide reflects the law as at June 2026. The Leasehold and Freehold Reform Act 2024 is being commenced in phases — some provisions referenced above may not yet be in force at the date of reading. Always verify current commencement orders and seek qualified legal advice before commencing RTM proceedings. This article does not constitute legal advice.