Leasehold properties are typically managed by the freeholder (landlord) or a managing agent employed by them. The leaseholders pay a monthly service charge to cover the costs of maintaining the building, including paying the managing agent. And they are consulted under Section 20 of the Landlord and Tenant Act 1985 about any relevant capital works to be undertaken. Otherwise, they usually have little to do with the day-to-day management of the building. Unless, that is, they claim the Right to Manage.
This is a legal provision that allows some leaseholders to take over management of their building, even without the landlord being at fault. If they qualify – then they can manage the building through a Right to Manage (RTM) company. Typically, they will then employ a managing agent of their own.
Leaseholders generally choose the Right to Manage for one or more of three reasons. One is that they no longer trust the freeholder to manage the building properly or with sufficient regard for their interests. Another is that there is a large proportion of leaseholders who take an active interest in the management of the building and want to have their say. And the third is that they simply want to reduce the service charges they are paying and believe they can save money by doing it themselves.
Of course, leaseholders are not usually experts on buildings and how to manage them. So in addition to hiring a managing agent to take on day-to-day responsibilities, RTM companies often bring in a building surveyor to provide strategic advice and guidance. This can be helpful even for something as simple as explaining the terminology involved in maintaining buildings and abiding by relevant laws and regulations. A suitably engaged surveyor will be happy to attend meetings of the RTM board and share their expertise. In fact, most surveyors will take any opportunity to talk about buildings, what’s wrong with them and how to put it right!
With the expert help of a surveyor, members of the RTM board are much better able to understand the complex issues affecting their building. Their surveyor will also be able to propose a range of solutions, both short and long term, to resolve the issues that inevitably arise. And by explaining the pros and cons of the various solutions, they can help the board come to an informed decision. Crucially, they can also help the board explain the reasoning behind such decisions to other leaseholders and the freeholder.
One of the key tools in a surveyor’s toolkit is the scoping document. Surveyors draft these documents to provide clarity and reasoning for proposed capital works schemes, by including all the relevant information in an easy to understand format with photographic reference. This provides transparency for all stakeholders, and serves as a convenient resource for the board, as well as the building’s freeholder.
A related tool is a long-term planned maintenance programme or PMP. This is based on a comprehensive survey of the building and allows for a joined-up approach to maintenance. Rather than waiting for problems to occur and dealing with them reactively, you can plan ahead, factoring in economies of scale and timing. A surveyor who has already been engaged by the RTM company and knows the building will be well placed to put together a PMP tailored to its particular needs.
The Right to Manage can be an attractive option for leaseholders who want more control over what happens with their building. But managing a property is never simple, and involves a range of technical, legal and practical considerations. A good building surveyor can help leaseholders who are engaged but ‘amateurs’ when it comes to looking after a building by providing professional help with those tricky technical issues.
