The great news is that if you had bought a flat in a development run by a Residents Management Company, you arguably have the most control over the future management of your property. Given the current discussion regarding freeholders, ground rents and government regulation, this can only be a positive for you.
In this article, we are going to explain what a residents management company is and 5 ways for you to get the most from yours.
Let’s start with the basics, what is a Residents Management Company?
A Residents Management Company is a private limited company similar to any other, it will have Directors that are registered at Companies House, it has to publish company accounts annually, hold Annual General Meetings as well as justifying decisions to shareholders.
Its responsibilities include the management and upkeep of the communal areas of your development as well as ensuring the terms of the individual leases are adhered to.
The big difference between a Residents Management Companies and a typical private limited company is that the Directors are also leaseholders, they are nominated by the other shareholders in the building and the role is entirely voluntary. This very well means you could also become a Director of a Resident Management Company, shaping the way that your development is run, which is a powerful position to be in.
Understanding that you’re in a powerful position is a good start now, let’s look at 5 different ways you can get the most from your own Residents Management Company:
1. Become a Director yourself
We have to start with the biggest step, (as we mentioned above) you can take to get the most from your Residents Management Company, becoming a Director yourself!
Being a Director will mean that you are responsible for important decisions in relation to how the development is run. You will be on the front line to effect change, covering legal compliance, financial management, and day to day issues to name but a few.
As the famous quote states ‘with great power comes great responsibility’, you will be required to sacrifice your time for the greater good of both the development and everyone that lives there, but you will have the power to positively impact your home for years to come.
2. Create a subcommittee for major refurbishment works
If the prospect of becoming a Director is a little too daunting or you don’t think you can give up the time for the role, there are other options which we have seen first-hand have a positive impact.
One option is to approach the Board of Directors to discuss helping out with any forthcoming major refurbishment works. These works can be time-consuming and can require a lot of effort with communication and organisation for the Directors so by offering to create a subcommittee specifically for the project may be well received.
You could lead this committee in organising an exhibition of the proposed works, reviewing of any quotes received, liaising with other residents and owners over the plans and so on. Whilst time consuming, this is merely for a singular project so will have a definitive end.
3. Offer your specialist skills to the Directors as a consultant
As we have spoken about, being a Director of a Residents Management Company is a voluntary role. The benefit of having a leaseholder as a Director is that you can have a Board with a variety of specialist skills meaning you can create a ‘dream team’ of skilled professionals.
Whilst in an ideal world, you would have skilled professionals that cover all the necessary topics, this isn’t always realistic. One thing you can do to work with your Residents Management Company is to offer your specialist skills where there may be a gap on the Board. If you are an accountant, you could help with the company finances. If you are a surveyor, you could help with refurbishment works and so on.
Again, this will put you in a powerful position without the overall obligations of a Director, also allowing you to use your skills to enhance the running of your development.
4. Ask the Residents Management Company about the day to day running of the development
A simple way you could get the very most from your Residents Management Company is to be present and aware in the day to day running.
Directors more often than not have day jobs too, so they would welcome willing participants to be their eyes and ears across the development. The Directors cannot be omnipresent to ensure all repairs are undertaken, that the cleaning is up to standard, that requests are being fulfilled and so on.
This is where you come in, you can help out by discussing any issues that are outstanding, finding out about regular contracts so that you can help inform the Board of any issues that haven’t been completed yet, you’ll be surprised at the welcome reception you will receive from this small and simple gesture!
5. Attend Annual General Meetings
Annual General Meetings for Residents Management Companies occur only once per year and yet are the perfect platform to meet your fellow residents and discuss building-wide issues that you may have questions about.
Showing your support for your nominated Directors once per annum, to have productive discussions and debates over future issues and plans, as well as giving you the opportunity to make suggestions for the betterment of the development, is exactly the reason for attending the annual general meeting. It is the very least you could do if you are serious about getting the very most from your Freehold Residents Management Company.
Michael Paul, Managing Director at Strangford Residence Management