Right to manage (RTM)

Right to manage, usually abbreviated to RTM, is a statutory right introduced by the Commonhold and Leasehold Reform Act 2002 that allows leaseholders in a block of flats to take over the day-to-day management of the building from the freeholder without having to prove that management has been poor. RTM is a "no-fault" right. If the building qualifies and the correct procedure is followed, management can transfer regardless of how well the freeholder or their managing agent has performed. RTM sits within the broader leasehold framework alongside lease extension rights and collective enfranchisement.

As gov.uk's guidance for landlords on RTM confirms, a successful RTM claim means the freeholder retains ownership of the building and the leases remain in place, but the RTM company takes over management responsibilities.

Which buildings qualify

For a block to qualify for RTM, the following conditions must all be met:

The building must consist of at least two flats. The block must be self-contained, or a self-contained part of a larger building capable of being managed independently. At least two-thirds of the flats must be held by qualifying leaseholders, those with leases that were originally granted for a term exceeding 21 years. At least half of all flats in the building must become members of the RTM company by the time the notice of claim is served.

Following changes introduced by the Leasehold and Freehold Reform Act 2024 (in force from 3 March 2025), a building may now contain up to 50% non-residential floor space (such as commercial units or offices on the ground floor) and still qualify for RTM. Previously this threshold was 25%, which meant many mixed-use buildings were excluded.

Certain buildings are disqualified regardless of the above. Where the local authority is the immediate landlord, where a previous RTM claim lapsed within the last four years, or, in converted buildings of four or fewer flats, where the freeholder or a family member occupies one of the flats as their principal home.

How the RTM process works

Leaseholders exercise RTM through a dedicated RTM company, which must be a private company limited by guarantee with articles of association in the prescribed statutory form. The process runs broadly as follows:

The RTM company serves a notice inviting participation on all qualifying leaseholders (giving at least 14 days). Once the company has members equal to at least half the qualifying flats, it serves a formal notice of claim on the freeholder, any intermediate landlords, and each qualifying leaseholder. The notice must specify an acquisition date, at least three months from the date the claim can be accepted. The freeholder has one month to serve a counter-notice. Grounds for counter-notice are limited: the freeholder can only dispute entitlement (the building or leaseholders do not qualify) or procedural defects. If the freeholder does not serve a valid counter-notice within the permitted period, the RTM company acquires management on the acquisition date. If a counter-notice is served in dispute, either party may apply to the First-tier Tribunal (Property Chamber) for a determination.

Under the Leasehold and Freehold Reform Act 2024 reforms, leaseholders are no longer automatically liable for the freeholder's reasonable costs of the RTM process. The freeholder now bears their own costs except in limited circumstances (such as unreasonable conduct or withdrawal of the claim). This change, also in force from 3 March 2025, significantly reduces the financial risk of bringing an RTM claim.

Right to manage transfers management only, not ownership. Leaseholders who want to buy the freehold of the building itself use collective enfranchisement instead.

What changes when RTM takes effect

When RTM takes effect on the acquisition date, the RTM company assumes management responsibilities that previously sat with the freeholder or their managing agent. This includes administering the service charge, setting annual budgets, collecting contributions, commissioning works, managing repairs to common parts, arranging buildings insurance, and overseeing contractors.

The RTM company can manage these functions directly or appoint a managing agent of its own choosing. The freeholder retains ownership of the building and the right to be a member of the RTM company with at least one vote. The leases themselves remain unchanged. The freeholder's remaining interests, including any ground rent rights, their own lease obligations, and rights to challenge unreasonable service charge demands, are unaffected.

As a freeholder whose building has transferred to RTM, you still have important interests to protect. Formal notices will be served on you throughout the process with strict deadlines for response. Missing a counter-notice deadline can mean losing the right to challenge an RTM claim on procedural grounds. If there is a genuine entitlement dispute, for example, whether the building or the leaseholders qualify, this can be referred to the First-tier Tribunal.

What RTM means if you let a flat in the block

In our experience supporting landlords across the UK, the RTM scenario that most often catches leaseholder-landlords off guard is this: a landlord who owns and lets out a flat in a block does not initiate RTM, but finds themselves affected by it when fellow leaseholders do.

If RTM transfers management to a company that is slower to commission repairs or less responsive to common-part issues, including roof leaks, damp ingress, lift failures, the implications can flow directly into the flat let to a tenant. Under the Renters' Rights Act 2025, in force from 1 May 2026, tenants have stronger routes to redress when a property does not meet the required rental standards, including through the expanded PRS Ombudsman. Where the underlying cause of a problem sits in the common parts, managed by the RTM company rather than the individual landlord, the landlord may still face a complaint or housing dispute with their tenant.

Leaseholder-landlords in RTM buildings should become members of the RTM company, exercise their vote on management decisions, and keep detailed records of any requests they make to the RTM company for common-part works that affect their let property. For the detail of what the Leasehold and Freehold Reform Act 2024 changed for RTM specifically, see our Leasehold and Freehold Reform Act 2024 explained.

Frequently asked questions

Do leaseholders have to prove poor management to claim RTM? 

No. RTM is a no-fault right under the Commonhold and Leasehold Reform Act 2002. Leaseholders do not need to show that the freeholder or their managing agent has failed in any way. If the building and leaseholders qualify and the process is followed correctly, management transfers regardless of the freeholder's track record.

Does RTM affect the ownership of the building? 

No. The freeholder retains ownership throughout. RTM only transfers management responsibilities to the RTM company. It is different from collective enfranchisement, where leaseholders purchase the freehold itself. The leases also remain in place, and leaseholders continue to pay any ground rent due under their individual leases.

What changed under the Leasehold and Freehold Reform Act 2024? 

Two significant changes came into force on 3 March 2025. First, the non-residential floor space threshold was raised from 25% to 50%, meaning more mixed-use buildings now qualify for RTM. Second, leaseholders are no longer automatically required to pay the freeholder's RTM costs, the freeholder now bears their own costs except in specific circumstances. Both changes make RTM easier and cheaper to exercise.