RTM - right to manage reserve funds separate to Property Management service funds?

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    RTM - right to manage reserve funds separate to Property Management service funds?


    Our block RTM has switched property managers for the past 10 years 4 times given we can't seem to find a property manager for our London block who after the first 6 months to a year continues to manage the block well without hiring their own "shady" suppliers who seem to charge 5 - 10x what the real cost should be. For example: Repairing the lift, they came out with a quote for £27,000+ and I found a quote for £6000 + VAT. If anyone can recommend a trustworthy block manager that would be greatly appreciated, this block is based in London.



    Given this RTM director responsibility, we discovered that not all funds are actually transferred from the reserve funds but these property managers do seem to keep a chunk for themselves with the transfer so I decided to create a bank account with our block name to hold these reserve funds.

    1) Is this allowed and can an RTM company manage its own reserve funds separately from the property manager?

    2) My block and the attached block next door were put as one RTM as we share a fire exit however can we decide to form our own individual RTM company separately? We seem to agree on all fire related matters so this doesn't seem to be an issue

    #2
    If you have regular problems appointing agents, it says something about your tender process, are you not making your requirements clear at the outset? If you don't want them to use their own contractors, you simply instruct them accordingly.
    I do not understand why the agents should deduct monies for themselves from the reserve funds, which should only be used for specific purposes set out in the lease. Why can you not ask the agents to account fully for the balance on the client bank account?
    I do not understand your comments about the RTM Company and the block next door. A reserve fund should be held in trust for the leaseholders who have contributed towards it. If you have contributed the full amount, there is no reason why you cannot hold the funds in your own separate client bank account as long as you inform the leaseholders.

    Comment


      #3
      Yes we do set out the cleaners will always remain the same along with other contractors. However there are always leaks in the block, then the agency decided the roof light needed to be replaced on their own and hired a shady contractor who put in a new plastic roof light 2m x 1 m only single glazed and charged £1400 for this job and couldn't provide a warranty for the job. London Property Managers are very very shady and it is actually well known in the business. This off jobs required ie right now the gutters are leaking even though the entire external refurb cost the block £625,000, there are still constant issues and these agencies find a way to hire their own people. DAYCO is another example of a company used continuously if its urgent.

      Thank you for advising that if I put reserve funds in a trust this can be kept separately. I'm not sure why agencies decided to take some of the case, we've had Hathaways, Trinity, Red Rock and now JFM - none of which are good agencies and will do as they please as this industry is not regulated in any way. I've spoke to many property companies in London and they all agree. Not sure where your living that you don't have these issues.

      If anyone can recommend someone trusty and worthy of managing a block with shady deals, please do let me know.

      Comment


        #4
        The important thing is that they are your agent and you should insist that they act as you wish. There is nothing to stop you from providing them with a list of your approved contractors. Agents are the same nationwide and many will seek alternative ways to add to their basic management fee. There are some who state that they receive nothing more than the fee, you just need to search for them.

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