RTM, RMC or enfranchisement: which route to control is right for your block?

If you live in a block of flats and you are unhappy with the way it is being managed, three phrases will probably come up sooner or later: Right to Manage, RMC, and collective enfranchisement. They are frequently conflated in flat-owner forums and sometimes even by solicitors who don't specialise in leasehold. In practice they are three very different things — with different costs, different legal processes, and crucially different outcomes for you and your neighbours.

This article maps out all three clearly, compares them on the dimensions that actually matter, and helps you work out which (if any) is the right route for your block.

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The three routes at a glance

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Right to Manage (RTM)

What it is

RTM is a statutory right granted by the Commonhold and Leasehold Reform Act 2002 (CLRA 2002). It allows the leaseholders of a qualifying building to take over the management of that building — without having to prove any wrongdoing by the freeholder or agent, and without paying a purchase price.

The RTM company is a company limited by guarantee, incorporated at Companies House using prescribed model articles. Once it acquires management on the acquisition date, it becomes responsible for the management functions defined in the leases: service charges, maintenance of common parts, insurance, compliance, and Section 20 consultations.

Qualifying criteria

Your building needs to meet all of the following:

• It must be a self-contained building (or a self-contained part of a building).
• It must contain two or more flats held by qualifying tenants.
• At least two-thirds of the flats must be held by qualifying tenants — leaseholders whose leases were originally granted for a term exceeding 21 years.
• Non-residential floor space must not exceed 50% of the building (this threshold was raised from 25% to 50% on 3 March 2025, bringing many mixed-use blocks into scope for the first time).
• RTM applies to flats only — houses do not qualify.

The participation requirement

Your RTM company must have qualifying tenants of at least half (50%) of the flats as members before you can serve the claim notice. You do not need every leaseholder to join, but you do need to invite all qualifying tenants before proceeding.

The process

1. Incorporate the RTM company at Companies House.
2. Serve a notice inviting participation on every qualifying tenant who is not yet a member.
3. Serve the claim notice on the freeholder (and any other party with management responsibilities). This triggers a one-month window in which the freeholder can serve a counter-notice admitting or disputing the claim.
4. If no counter-notice arrives, the claim is deemed admitted. If disputed, the matter goes to the First-tier Tribunal (Property Chamber).
5. Management transfers on the acquisition date — at least three months after the counter-notice deadline.

What RTM costs

Since 3 March 2025, new provisions under the Leasehold and Freehold Reform Act 2024 mean that, in a non-contentious RTM claim, the RTM company is generally no longer liable for the freeholder's process costs. Previously, leaseholders routinely had to cover the freeholder's solicitor and surveyor fees even when there was nothing to dispute — a significant deterrent. That deterrent has been removed for clean claims.

Your costs will be the incorporation fee at Companies House, and your own solicitor's fees if you use one. Many straightforward RTM claims are done with competent guidance at relatively low cost.

What RTM does NOT give you

This is the most important thing to understand clearly. RTM gives you management control. It does not:

• Give you the freehold.
• Let you set or forgive ground rent.
• Let you grant lease extensions to yourselves (you still need the individual statutory route or collective enfranchisement).
• Eliminate the freeholder — they retain ownership of the building structure and the land.

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Resident Management Company (RMC)

What it is — and what it is not

An RMC is not something you acquire. It is a company that already exists as part of the legal structure of your block, usually set up by the developer when the flats were sold, or otherwise defined in the leases themselves.

In some blocks the leases require the freeholder to delegate management to a named management company in which the flat owners are shareholders or members. In others the RMC may actually hold the freehold (essentially functioning as a form of collective ownership from the outset). The precise role depends entirely on the terms of the leases and the RMC's articles of association.

If your block has an RMC, you are almost certainly already part of it — or entitled to be. There is no RTM process to go through; the management structure is already yours. The challenge is usually getting it functioning well: holding proper meetings, maintaining accounts, keeping the Companies House filings up to date, and running the block competently.

The key distinction

People sometimes say "we're going to set up an RMC" as if it were analogous to the RTM process. It isn't. You cannot acquire an RMC through a statutory process. If your block does not already have one defined in the leases, your route to management control is RTM or enfranchisement — not setting up an RMC.

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Collective Enfranchisement

What it is

Collective enfranchisement is the right for leaseholders to buy the freehold of their building together, under the Leasehold Reform, Housing and Urban Development Act 1993. It is a genuine purchase — you pay a premium calculated by a surveyor (or determined by the First-tier Tribunal if you and the freeholder cannot agree). In return, the group of participating leaseholders acquires the freehold, usually through a nominee purchaser company.

What enfranchisement gives you that RTM doesn't

• Full ownership. The freehold belongs to you collectively, not a third party.
• Ground rent income (if any ground rents remain payable by non-participating leaseholders, though in practice this is modest and diminishing under recent reforms).
• The ability to grant lease extensions to yourselves at nominal premium — typically a peppercorn ground rent and an extended term, without going through the individual statutory process.
• No freeholder to satisfy on consent matters — alterations, subletting, and similar approvals no longer require a third party.

What enfranchisement costs

Unlike RTM, enfranchisement involves paying a premium. That premium is calculated by reference to the capitalised value of the ground rent, the value of the freeholder's reversion, and other statutory factors. It varies enormously — from modest amounts for blocks with low ground rents and long leases to six-figure sums for prime London buildings or blocks with onerous leases.

On top of the premium you pay: your own legal and surveying fees, and by convention (under the 1993 Act) the freeholder's reasonable legal and surveying fees too. A contested claim adds Tribunal costs. Enfranchisement is typically significantly more expensive than RTM.

Qualifying criteria

At least two-thirds of the flats must be held by qualifying tenants (broadly the same definition as RTM — originally granted for more than 21 years), and at least half of qualifying tenants must participate in the claim. There are also restrictions on buildings where the freeholder occupies more than 10% as their principal or only home, and other technical conditions. A specialist solicitor is essential.

What enfranchisement does NOT change

Buying the freehold does not, by itself, change how the building is managed day to day. You will still need to set budgets, demand service charges, run Section 20 consultations, and keep compliance up to date — just now on behalf of your own freehold company rather than a third-party freeholder.

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How to decide

Here is the honest decision framework:

Choose RTM if: You want to take control of how the building is run, you cannot or do not want to buy the freehold, you need to move relatively quickly, and you can reach the 50% participation threshold. RTM is the most accessible route for most blocks.

You already have an RMC if: Your leases define a management company in which flat owners participate. Check your lease — there may be work involved in activating or reforming it, but no statutory process is needed.

Choose collective enfranchisement if: You want full ownership, you have the funds (or can share the premium across enough participating leaseholders), and you want the ability to grant your own lease extensions. Enfranchisement makes most sense when the premium is relatively low relative to the benefits — typically when ground rents are low and leases are already short (making extensions expensive anyway).

Neither route is needed if: Your block is self-managed and works well, or you have an engaged landlord. RTM and enfranchisement are tools for when the status quo is not working.

A word on commonhold

There is a longer-term route on the horizon: commonhold, under which flat owners own their units freehold and collectively own the common parts through a commonhold association — no freeholder, no ground rent, no expiring lease. The government's Commonhold White Paper (published 3 March 2025) and the draft Commonhold and Leasehold Reform Bill (published 27 January 2026, currently in pre-legislative scrutiny) set out plans to make commonhold the default tenure for new flats. Conversion for existing blocks is complex, and timelines remain uncertain. We cover this in detail in a separate article.

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FAQ

Can I do RTM if we already have an RMC? Possibly, if the RMC does not already hold management responsibility — but it depends on your leases. If the RMC already controls the management of the building, RTM may not apply or may be unnecessary. Get legal advice specific to your situation.

Do I need 100% of leaseholders on board for RTM? No. You need qualifying tenants of at least 50% of the flats as members of the RTM company when you serve the claim notice. Non-participants can join later, but the 50% threshold must be met at the point of the claim.

What happens if the freeholder disputes our RTM claim? They may serve a counter-notice disputing it on prescribed grounds (for example, arguing the building doesn't qualify). If you cannot resolve the dispute, it goes to the First-tier Tribunal (Property Chamber), which will adjudicate. Most genuine qualifying claims succeed even if disputed.

Is enfranchisement the only way to extend our leases cheaply? No — each leaseholder can pursue an individual statutory lease extension under the 1993 Act (now without the previous two-year ownership rule, which was abolished on 31 January 2025). But if the group buys the freehold collectively, you can grant extensions to yourselves on your own terms, which is often significantly cheaper and faster.

Can the freeholder refuse RTM? They can dispute it, but only on prescribed statutory grounds — they cannot simply refuse because they don't want to lose management. If the building qualifies and you follow the process correctly, RTM is a right, not a request.