Should Flat Owners Wait Before Exercising the Right to Manage?

1. Expansion of RTM Eligibility

Previously, the RTM was only available in respect of buildings with no more than 25% non-residential use. This has now been increased to 50%, bringing more mixed-use buildings within the scope of the RTM regime.

2. Revised Cost Liabilities

The cost position has shifted in favour of leaseholders. RTM companies and their members are no longer liable for the landlord’s costs arising from a claim notice, unless one of the exceptions under sections 87A or 87B of the Commonhold and Leasehold Reform Act 2002 applies. This removes a key deterrent for many flat owners.

3. Tribunal Jurisdiction

Responsibility for enforcement of RTM-related obligations has been transferred from the County Court to the First-tier Tribunal, which is generally considered better equipped to handle such disputes.
 

What Further Changes May Be On the Horizon?

The Law Commission’s 2020 report on the Right to Manage identified a number of limitations in the current legislation. While a small number of its 101 recommendations have been implemented, the majority remain outstanding and are expected to be considered further in a future reform bill. These include:
- Extending the RTM to leasehold houses and buildings with only one qualifying tenant.
- Reducing the qualifying tenant threshold from two-thirds to one-half.
- Enabling RTM claims over part of a building, even where there is no clean vertical separation.
- Allowing estate-wide RTM claims over multiple buildings with shared facilities.
- Improving the process for information provision, notice service, and contract handover.
- Giving RTM companies the ability to relinquish management responsibilities and formalising what happens when the RTM ends.
 

Should Leaseholders Wait?

For leaseholders who now qualify following the increase in the non-residential threshold and who have no significant procedural barriers, the case for proceeding is stronger. The new rules reduce exposure to landlord costs and streamline enforcement, making the process more accessible and cost-effective.
Where, however, a building still does not qualify—for example, due to being a leasehold house or a single qualifying flat above a shop—there may be no option but to wait until further reform is brought forward.
Leaseholders in multi-building estates or with complex site layouts may also benefit from waiting if the planned changes are likely to remove existing technical barriers.
Ultimately, the decision will turn on the specific circumstances of each building. For some, it may be possible to bring a claim now with confidence under the new rules. For others, it may be more prudent to wait.
 

What About Ground Rents?

Separately, the Government has proposed changes to ground rents under existing leases. A consultation launched in 2023 considered various models for capping ground rent, including:
- Reducing it to a peppercorn;
- Imposing a financial cap;
- Freezing it at the initial rent level; or
- Linking it to a percentage of the property value.

These proposals remain under review, but the current Government has pledged to “tackle unregulated and unaffordable ground rent charges”. If ground rents are capped retrospectively, this will directly affect lease extension and enfranchisement premiums.
Flat owners considering whether to extend their lease or acquire the freehold may therefore wish to monitor the progress of this legislation carefully.
 

Conclusion

The changes now in force represent tangible improvements to the RTM regime and remove some of the cost and complexity that previously discouraged claims.
However, the larger reform package remains incomplete. For flat owners who are newly eligible and are keen to take control of their building’s management, now may be the right time to proceed. For others—particularly those currently excluded or who would benefit from procedural simplification—waiting may offer a better route.
We are advising leaseholders on both options and would be happy to assist you in determining the right course of action for your building.
Mark Vinall, Solicitor and Partner, Ashley Wilson Solicitors LLP