5 things RTM companies get wrong after they’ve taken over
We’ve covered the basics of Right to Manage before, eligibility, how the process works, what changes once you’ve taken control. What we haven’t covered is what actually trips RTM companies up once the paperwork’s done and the building is theirs to run.
Because that’s where most of the problems show up. Here’s what we see going wrong most often.
1. Assuming contracts just carry over
Insurance, cleaning, lift maintenance, fire alarm servicing, gardening. None of it automatically transfers with the management. Every existing contract needs to be reviewed, and either renegotiated, re-tendered or ended properly, and that has to happen before or right at handover. RTM companies that leave it too late can end up with gaps in cover or services quietly lapsing.
2. Not realising compliance now sits with you
Fire safety, building safety, health and safety at the property. As an RTM company, you’re now the one responsible for it, not the landlord or their agent. Under the Building Safety Act, that responsibility can be significant depending on the building. It’s worth understanding exactly what you’re now accountable for, rather than relying on the previous managing agent’s records to know what’s even been done.
3. Inheriting a building with no reserve fund
A lot of buildings hand over with little, or nothing set aside for major works. Roofs, lifts, render, fire doors. It all needs paying for eventually, and if there’s no sinking fund in place, the bill lands on leaseholders all at once rather than being spread over time. Get a proper condition survey done early and start building reserves from day one.
4. Forgetting the landlord doesn’t disappear
Once RTM is acquired, the landlord is entitled to membership of the company. People are often surprised the freeholder still has a seat at the table, even though day to day control has moved to the leaseholders.
5. Underestimating that it’s a company, not a committee
An RTM company is a company. That means statutory accounts, Companies House filings, proper board decisions, and directors carrying director level responsibility, not just an informal residents’ group with a bank account. Buildings that treat it too casually tend to find out the hard way when something goes wrong.
Getting it right after handover
This is exactly where we spend most of our time with RTM companies. Not the formation, but making sure what comes after it is set up properly: contracts, compliance, reserves and governance.
We’ve supported RTM companies through this stage before and know how to make the handover smooth. As managing agent, we handle the heavy lifting, but it’s your building, so RTM Directors and leaseholders should always have real influence over how it’s run. That’s the standard we hold ourselves to, alongside straightforward, competitive pricing with no hidden fees or commissions.
If you’ve recently taken on RTM and want a second opinion on how things are set up, get in touch for a no obligation conversation.