If you are a leaseholder and want more control over how your development is managed, the good news is that you DO have options to change your managing agent.
At Brady Solicitors we are passionate about helping leaseholders to have their say in how their block is managed and their service monies spent. We work with lots of highly skilled managing agents, which means we also have a good insight into what good looks like when it comes to property management.
Here, we explain four ways you can change your managing agent.
Changing managing agent option 1: Right to Manage
Right to Manage (RTM) is a popular option for leaseholders who want to change managing agent, and Brady Solicitors are experts in helping leaseholders through a successful RTM application.
To apply for RTM, you do not have to prove that the managing agent has been negligent or otherwise incompetent – but you do have to meet strict eligibility criteria.
To qualify for RTM, the block must be structurally detached (including any aspects underground such as a car park or gym facilities that are shared with other buildings) and no more than 25% commercial. Read more about the qualifying criteria here.
You also need the support of at least 50% of the leaseholders and, ideally, some leaseholders willing to act as directors.
Your freeholder has only limited rights to refuse an application for Right to Manage, but it’s important to note that the leaseholders will have to pay the freeholder’s legal costs.
Once the Right to Manage application is complete, the RTM company takes over the management of the block from the freeholder and can appoint its own managing agent.
Changing managing agent option 2: Appointment of Manager
Leaseholders can change managing agent by applying to the First-tier Tribunal (FTT). to ‘appoint a manager’. This is a fault-based process, so you need to be able to specify your areas of discontent with the existing managing agent.
You don’t need a minimum number of leaseholders for an Appointment of Manager application – any one individual can start the process to change managing agent – but we always recommend getting support from fellow leaseholders where possible.
The first step is to issue the freeholder with a ‘preliminary notice’ (also referred to as a section 22 notice), detailing the areas of concern over the management of the property, and giving them the chance to put them right.
If the freeholder fails to fix the problems, you can then apply to the FTT. At this point, you should also put forward a potential candidate for the manager role.
If the application is successful, the FTT will grant an order to appoint a manager. The managing agent is then responsible only to the FTT – they are not required to seek or accept instructions from the freeholder or leaseholders. As such, this is a
Changing managing agent option 3: Collective Enfranchisement
Leasehold enfranchisement (commonly known as collective enfranchisement) entitles the leaseholders of a block of flats to collectively purchase the freehold of the property.
By ‘buying out the freeholder’ and securing the freehold, you can gain control over issues such as maintenance, ground rent, service charges, repairs, and so forth.
There are qualifying criteria that must be met, and the process can take several months to finalise if you are dealing with a difficult freeholder.
Collective enfranchisement is usually the most expensive method of changing managing agent – but it does give leaseholders the greatest control.
Changing managing agent option 4: Termination of Contract
You may however have another, more practical, route to changing the managing agent at your block, by obtaining an expert view on your management agreement to see if there is an option to terminate the contract. This option is not always clear on first view and there may be certain caveats that need exploring.
Brady Solicitors can provide a fast and effective review of your management agreement and establish if you have the right to give the managing agent notice and appoint a new managing agent of your choice.
Take the first step to changing managing agent
With several options to consider, each with its own practicalities and complexities, it is important to arm yourselves with all the available information and take advice from a specialist block management law firm. Bradys works with a large portfolio of managing agents, dealing with all kinds of estates, that we can introduce you to.
