Self-Managing a Block of Flats: Complete Guide
Everything you need to know about how to manage your own block of flats, from understanding the legal position and compliance obligations to the practical realities of self management block of flats arrangements. Learn whether a block of flats has to have a management company, what self-management involves day to day, and when it makes sense to appoint a professional managing agent.
Can You Self Manage a Block of Flats?
Can you self manage a block of flats? The short answer is yes, but only if the leaseholders have the legal right to take on management responsibilities. There is no law that requires a block of flats to be managed by a professional managing agent. However, the right to manage your own building depends on the ownership and legal structure of the block, and whoever takes on management must comply with the same legislation that applies to any professional block management director.
Does a block of flats have to have a management company? No. There is no statutory requirement to appoint a management company. The obligation is to ensure the building is properly managed, maintained, and compliant with all relevant legislation. Whether that is achieved through a professional agent, a resident management company, or a group of leaseholders acting as directors of a freehold or RTM company is a matter of choice rather than legal requirement.
When You Can Self-Manage
You can self manage if the leaseholders collectively own the freehold (known as share of freehold), if you have formed a Right to Manage company under the Commonhold and Leasehold Reform Act 2002, or if the freeholder is willing to hand over day-to-day management. In each case, the managing party assumes full legal responsibility for the building. Our Right to Manage guide explains the RTM process in detail.
When You Cannot Self-Manage
If the lease specifically requires management by a named party or professional agent, or if the freeholder retains management rights and will not delegate them, leaseholders may not be able to self manage without first exercising the Right to Manage or acquiring the freehold. Some leases also contain restrictions that make it impractical for leaseholders to take on management without professional support, particularly in larger or more complex buildings.
Understanding the legal position is the essential first step. Before committing to self management block of flats arrangements, leaseholders should take legal advice on their lease terms, the structure of their freehold or RTM company, and the obligations they will be taking on.
What Self-Management Involves
How to manage a block of flats yourself is not a simple question. The scope of work involved in running a residential building is substantial, and anyone considering self management should understand the full range of responsibilities before taking them on. Self-management covers three broad areas: day-to-day operations, financial management, and legal compliance.
Day-to-Day Tasks
- Arranging and supervising cleaning of communal areas
- Managing repairs and maintenance to the structure, roof, windows, and shared services
- Instructing and overseeing contractors for planned and reactive maintenance
- Responding to leaseholder enquiries, complaints, and emergencies
- Managing communal facilities including gardens, parking, and bin stores
- Keeping records of all maintenance work and contractor performance
Financial Management
- Setting and collecting service charges from all leaseholders
- Preparing annual service charge budgets and year-end accounts
- Maintaining a reserve fund for major works and long-term maintenance
- Issuing demands in the correct format as required by Section 21 of the Landlord and Tenant Act 1985
- Managing arrears and taking action on unpaid service charges
- Holding service charge funds in a designated trust account
Our service charge guide explains the legal requirements for service charge administration in detail.
Compliance
- Ensuring fire safety compliance under the Fire Safety Act 2021 and Regulatory Reform (Fire Safety) Order 2005
- Meeting obligations under the Building Safety Act 2022 for higher-risk buildings
- Arranging adequate buildings insurance and maintaining employer liability cover where required
- Complying with health and safety legislation for communal areas
- Following Section 20 consultation procedures for qualifying works and long-term agreements
- Filing annual returns and maintaining statutory records for the management company at Companies House
The breadth of responsibilities involved in how to manage your own block of flats is often underestimated. Each of these areas requires knowledge, time, and attention to detail. Failure in any area can result in legal liability, financial penalties, or a decline in the condition of the building.
Legal Obligations You Must Meet
Anyone considering how to manage a block of flats must understand that the legal obligations are the same whether you are a professional managing agent or a group of volunteer leaseholder directors. Ignorance of the law is not a defence, and the consequences of non-compliance can be severe.
Fire Safety
The Responsible Person for fire safety in a block of flats is the party who controls the communal areas. If you self manage, that is you. Under the Regulatory Reform (Fire Safety) Order 2005, the Fire Safety Act 2021, and the Building Safety Act 2022, you must carry out regular fire risk assessments, maintain fire detection and alarm systems, ensure escape routes are clear and properly maintained, keep fire safety records, and act on the recommendations of fire risk assessors. Failure to comply can result in enforcement action, fines, or criminal prosecution.
Insurance
The managing party must arrange adequate buildings insurance for the entire block, including cover for the structure, communal areas, and third-party liability. Leaseholders who self manage need to ensure the policy meets the requirements of the lease and that insurance is kept in force at all times. If the building employs any staff, including caretakers or cleaners, employers liability insurance is also compulsory. Failure to maintain adequate insurance leaves the directors personally exposed to significant financial risk.
Health and Safety
All communal areas must be maintained in a safe condition. This includes regular inspections of stairways, corridors, lifts, car parks, and external areas. Risk assessments must be carried out and hazards addressed promptly. Legionella risk assessments are required where water systems serve communal areas, and asbestos surveys are required in buildings constructed before 2000. The managing party must maintain an asbestos register and manage any asbestos-containing materials safely.
Service Charge Accounting
Under Section 21 of the Landlord and Tenant Act 1985, all service charge demands must be accompanied by a summary of the rights and obligations of tenants. Service charge accounts must be prepared annually and made available to leaseholders on request. The service charge funds must be held in a designated account, and leaseholders have the right to inspect the accounts and supporting documents. Poor financial management is one of the most common causes of disputes in self-managed blocks.
Section 20 Consultation
Before carrying out qualifying works costing more than 250 pounds per leaseholder, or entering into a qualifying long-term agreement costing more than 100 pounds per leaseholder per year, the managing party must follow the Section 20 consultation procedure. This involves serving formal notices, inviting observations, obtaining multiple estimates, and giving leaseholders the opportunity to nominate contractors. Failure to follow the Section 20 process limits the amount that can be recovered through the service charge, regardless of the actual cost of the work.
These obligations apply in full to anyone who takes on the management of a block of flats. The legal burden is the same whether you are a professional agent with a team of compliance specialists or a group of leaseholders managing the building in your spare time.
Advantages of Self-Management
There are genuine benefits to self management block of flats arrangements, and for some buildings it can be an effective way to run the block. Understanding the advantages helps leaseholders make an informed decision about whether self-management is right for their building.
- Cost savings: eliminating managing agent fees, which typically range from 150 to 500 pounds per unit per year, can result in meaningful savings on the service charge
- Direct control: leaseholders choose their own contractors, set priorities for maintenance, and decide how the service charge budget is spent
- Faster decision-making: without the need to go through an agent, decisions on minor repairs and day-to-day issues can be made quickly
- Greater transparency: leaseholders have direct access to accounts, invoices, and contracts, reducing the risk of opaque charges
- Stronger community: involvement in the management of the building can foster better relationships between residents and a stronger sense of ownership
- Accountability: those managing the building are also living in it, giving them a direct personal interest in maintaining high standards
These advantages are most likely to be realised in smaller blocks where leaseholders know each other, have relevant skills, and are willing to commit time to the management of the building. In larger or more complex buildings, the advantages can be harder to achieve without professional support.
Risks and Disadvantages of Self-Management
While there are clear benefits, how to manage your own block of flats successfully is far more demanding than many leaseholders anticipate. The risks and disadvantages must be weighed carefully against the potential savings.
Personal Liability
Directors of a management company or RTM company can face personal liability for failures in fire safety, health and safety, or insurance. If someone is injured in a communal area and the managing party has not carried out a proper risk assessment, the directors may be held personally responsible. Directors and officers insurance can mitigate this risk, but it does not eliminate it.
Time Commitment
Managing a block of flats is not a passive role. It requires regular attention to maintenance issues, financial administration, contractor management, compliance checks, and correspondence with leaseholders. In many self-managed blocks, the burden falls on one or two willing volunteers who can quickly become overwhelmed, particularly when major works or urgent repairs arise.
Compliance Burden
The regulatory landscape for residential buildings is complex and constantly evolving. The Building Safety Act 2022 has introduced new obligations for higher-risk buildings, fire safety legislation has been strengthened, and service charge law requires careful attention to procedure. Professional managing agents invest in training, compliance systems, and legal updates. Self-managing leaseholders must find ways to stay informed and compliant without those resources.
Disputes Between Leaseholders
When leaseholders disagree about priorities, budgets, or the quality of work, disputes can become personal and difficult to resolve. A professional managing agent provides a buffer between conflicting interests and can make impartial decisions based on the lease terms and best practice. In self-managed blocks, disagreements can damage relationships between neighbours and lead to paralysis in decision-making, leaving urgent maintenance unaddressed.
These risks are not theoretical. Many blocks that have attempted self management have found that the initial enthusiasm fades when the reality of the workload becomes clear, or when a major compliance issue arises that requires expert knowledge to resolve.
When to Consider a Professional Managing Agent
Self-management is not an all-or-nothing decision. Many leaseholder groups who have exercised the Right to Manage or who own the freehold choose to appoint a professional managing agent to handle the day-to-day operations while retaining strategic control as directors. This hybrid approach gives leaseholders the best of both worlds: control over major decisions and the assurance that a qualified professional is handling compliance, financial administration, and contractor management.
You should consider appointing a professional managing agent if your building has more than 10 to 15 units, if it includes complex building systems such as lifts, centralised heating, or fire suppression, if it falls within the scope of the Building Safety Act 2022 as a higher-risk building, if your directors lack the time or expertise to meet compliance obligations, or if disputes between leaseholders are affecting the management of the building.
Our guide on how to choose a managing agent walks you through what to look for in a professional agent, including accreditation, insurance, financial transparency, and client references. If you are already with an agent and considering a change, our guide to switching managing agent explains the process step by step.
At Block, we work with many RTM companies and share of freehold groups who have chosen to retain a professional agent after taking control of their building. We provide the expertise and compliance framework while the directors retain full oversight and decision-making authority.
How to Set Up Self-Management
If you have decided that self management is the right approach for your block, there are two main routes to achieving it: exercising the Right to Manage or acquiring the freehold through a share of freehold arrangement.
The Right to Manage (RTM) Process
The Right to Manage under the Commonhold and Leasehold Reform Act 2002 allows qualifying leaseholders to take over the management of their building without having to prove fault on the part of the current manager and without buying the freehold. The process involves the following steps:
- Establish that your building qualifies: it must contain at least two flats, at least two thirds of the flats must be held on long leases, and no more than 25 per cent of the building can be used for non-residential purposes
- Incorporate an RTM company at Companies House with articles of association that comply with the statutory requirements
- Invite all qualifying leaseholders to participate as members of the RTM company
- Serve a claim notice on the freeholder and any other relevant parties, giving at least one month for a counter-notice
- If the freeholder does not dispute the claim, the RTM company acquires the right to manage on the date specified in the notice
- If the freeholder disputes the claim, apply to the First-tier Tribunal (Property Chamber) for a determination
For a detailed walkthrough, read our complete Right to Manage guide.
Share of Freehold
If the leaseholders collectively purchase the freehold, they gain complete control over the management of the building. This is known as share of freehold or collective enfranchisement. The freehold is typically held by a company in which each leaseholder is a shareholder and director. This route gives the greatest level of control but also the greatest level of responsibility. The freehold company becomes the landlord and must comply with all landlord obligations under the lease and under statute. Share of freehold is most common in smaller blocks of two to six flats and in buildings where the leaseholders want permanent control rather than the management rights alone that RTM provides.
Whichever route you take, the block management directors guide is essential reading for anyone who will be serving as a director of the management or RTM company. It covers your duties, your liabilities, and how to run the company effectively.
Frequently Asked Questions About Self-Managing a Block of Flats
Can you self manage a block of flats?
Yes, you can self manage a block of flats, but only if you have the legal right to do so. If the leaseholders collectively own the freehold (share of freehold) or have exercised the Right to Manage under the Commonhold and Leasehold Reform Act 2002, they can take over management responsibilities without appointing a professional managing agent. However, self-management means the directors or committee members become personally responsible for compliance with fire safety legislation, health and safety law, insurance obligations, and proper service charge accounting. Before deciding to self manage, leaseholders should carefully assess whether they have the skills, time, and willingness to meet these legal duties.
Does a block of flats have to have a management company?
No, a block of flats does not have to have a professional management company. There is no legal requirement to appoint a managing agent. However, the freeholder or the party responsible for management must still comply with all relevant legislation, including fire safety regulations under the Fire Safety Act 2021 and the Building Safety Act 2022, health and safety obligations, insurance requirements, and service charge accounting rules under Section 21 of the Landlord and Tenant Act 1985. Whether management is handled by a professional agent, an RTM company, or a group of leaseholders acting as directors, the legal obligations remain the same. Many blocks choose to appoint a professional managing agent because of the complexity and liability involved.
How much does Right to Manage cost?
The cost of exercising the Right to Manage varies depending on the size and complexity of the building and whether the freeholder challenges the claim. At a minimum, you will need to pay for the incorporation of an RTM company at Companies House, which costs a small filing fee, and for the service of formal notices on the freeholder and all leaseholders. Legal fees for preparing and serving the claim notice typically range from 1,500 to 5,000 pounds. If the freeholder disputes the claim and the matter proceeds to the First-tier Tribunal, costs can increase significantly. Under the RTM process, the leaseholders are generally responsible for the freeholder's reasonable costs of the transfer, but not their costs of opposing the claim at tribunal.
What are the disadvantages of RTM?
The main disadvantages of Right to Manage include the administrative burden of running the RTM company, the legal responsibilities that transfer to the directors, and the potential for disputes among leaseholders. Once an RTM company takes over, its directors become responsible for ensuring compliance with fire safety, health and safety, and building safety legislation. They must manage service charge budgets, arrange building insurance, organise maintenance and repairs, and comply with Section 20 consultation requirements for major works. Directors can face personal liability if the company fails to meet its obligations. There can also be difficulties if leaseholders disagree on priorities, budgets, or the appointment of contractors, and running the RTM company requires ongoing time and commitment.
Who is responsible for managing a leasehold property?
The responsibility for managing a leasehold property depends on the terms of the lease and the ownership structure of the building. In most cases, the freeholder is responsible for the management of the building, including the maintenance of communal areas, the structure, and shared services. The freeholder may carry out management directly or appoint a managing agent to act on their behalf. If the leaseholders have exercised the Right to Manage, the RTM company assumes these management responsibilities. If the leaseholders collectively own the freehold through a share of freehold arrangement, the management responsibility falls on the freehold company and its directors. Regardless of who manages the building, the managing party must comply with all relevant leasehold legislation and the obligations set out in the lease.
Is right to manage a good idea?
Right to Manage can be a good idea if leaseholders are dissatisfied with the current management of their building and have the skills and commitment to take on the responsibility. It gives leaseholders direct control over how their service charges are spent, the ability to choose their own contractors and managing agent, and a greater say in the day-to-day running of the building. However, it is not without risk. The directors of the RTM company take on significant legal obligations, and if they lack experience in property management, compliance, or financial administration, the standard of management can decline. RTM works best when leaseholders are well organised, have access to professional advice, and are prepared to invest time in governance. For many blocks, exercising RTM and then appointing a professional managing agent to handle day-to-day operations is the most effective approach.
Need Help Managing Your Block of Flats?
Whether you are setting up self management and need expert guidance, looking for a professional managing agent to support your RTM company, or considering switching managing agent to improve the service your building receives, Block is here to help. We work with Right to Manage companies and share of freehold groups across England and Wales, providing professional block management with full transparency and accountability.