The Right To Manage; Not always the Magic Answer
February 20th, 2014
The Commonhold and Leasehold Reform Act 2002 (CLARA 2002) granted leaseholders the Right to Manage their own property; it offered leaseholders the chance to collectively acquire the management of their property. While leaseholders rush to acquire their Right to Manage, it is gradually beginning to show that the grass was not necessarily greener on the other side.
When the leaseholders are unhappy with the management of their property, most Freeholders would be willing to liaise directly with them and make compromises to rectify their concerns.
On the face of it, the common issues present are easily rectified by the leaseholders taking on the management of their property themselves; they can obtain their own insurance, and arrange for any maintenance to be carried out as and when they want.
In reality, the day-to-day management of a property is a full-time job. The property must be managed in strict accordance with the leases and the leaseholders are therefore not in a position to do as they please.
It is easily forgotten, amidst efforts to reduce the cost of living, that Property Managers are professionals. They offer the experience and practical skills to effectively manage a property and act with total independence from the residents, reducing the possibility of disputes.
Unfortunately those that take the lead in bringing about the Right to Manage are often those least prepared to do so, and this can cause disputes. Disagreements are always detrimental to the effective management of a property, but in cases of RTM Companies, these disputes will often be with neighbours, rather than with the Landlord. The prospect of suing a fellow resident for unpaid service charges, or arguing amongst neighbours over the colour of the new wallpaper, is enough to make a minimal agent’s fee worthwhile.
The chance to manage their own property is showing to be not so much an opportunity to improve the management of the building for the leaseholders, but merely an illusion that the control has shifted from the Landlord. Whilst this seems to be the case in the beginning, over time, the necessity of a professional Managing Agent begins to shine through.
Tom Colley AIRPM
Property Manager
