Right to Manage companies give qualifying tenants in England & Wales the right to take over the management of the building in which their flats are situated. They do not need to prove that the freeholder/landlord is at fault or has mismanaged the building. However a Right to Manage company cannot acquire or own the building.
A Property Management Company is appropriate where the leaseholders share a building that has been separated into individually owned and occupied units, or where leaseholders or freeholders of units within a development share common amenities such as private roads, pumping stations or grounds ("the facilities") and the company may own the property that it manages.
Property Management Comparison
What is a Right to Manage Company?
What is a Property Management Company?
A property management company is appropriate where:
The company will (among other things);
Can a Right to Manage Company be limited by shares or by guarantee?
RTMs must be limited by guarantee as per the legislation laid down in The Commonhold & Leasehold Reform Act 2002
Can a Property Management Company be limited by shares or by guarantee?
If it is a share company, the company normally issues one share to each flat owner. Each share will have a nominal value and upon payment for the share each applicant shall be entitled to and then become a member of the company and can vote as a member.
This is the simplest form of management company to administer. This is because it is much easier to deal with changes of ownership (the outgoing tenant automatically ceases to be a member when the incoming tenant is admitted as a member) so there is no need to physically transfer shares. Members have one vote for each unit they hold.
Benefits of a Right to Manage Company
Benefits of a Property Management Company
The benefits of a well-run property management company with on-site directors who communicate regularly with the unitholders are:
What should you bear in mind with a Right to Manage Company?
What should you bear in mind with a Property Management Company?