Most RMC and RTM directors know their managing agent is not good enough. They know the service charge accounts are late, the maintenance requests go unanswered, and the reserve fund is thinner than it should be. What stops them changing is not satisfaction — it is fear. Fear that the handover will be chaotic, that the outgoing agent will withhold documents or funds, that the building will be left in a worse state during the transition than it was before.
That fear is understandable. Bad handovers do happen. But they happen because directors do not know what to demand, what the legal position is, or how the process actually works. This guide gives you the complete picture: who has the authority to make the switch, what the process looks like step by step, what your outgoing agent is legally required to hand over, and what to do when they drag their feet.
In This Guide
- Who Has the Authority to Change the Managing Agent?
- The Switch Process: Seven Steps
- Managing the Handover: Three Stages
- Verifying the Financial Transfer
- The Post-Handover Audit Checklist
- What Goes Wrong — And How to Handle It
- Ten Questions to Ask a Prospective Managing Agent
- Frequently Asked Questions
Who Has the Authority to Change the Managing Agent?
This depends on who controls the management of your building. The answer determines your route and what you need to do first.
| Your Situation | Who Decides | What You Need |
|---|---|---|
| RMC owns the freehold | RMC directors | Board resolution to terminate the existing contract and appoint a new agent. Check articles of association for any quorum requirements. |
| RTM company has exercised Right to Manage | RTM company directors | Board resolution. The RTM company holds management functions under the lease. |
| Freeholder appoints the agent | The freeholder | You need the freeholder's cooperation — or you need to pursue RTM or apply to the First-tier Tribunal for a manager appointment. |
| No management company exists | Usually the freeholder | Consider forming an RTM company to take control. Alternatively, approach the freeholder directly or apply to the FTT. |
If you are an RMC or RTM director, you have the direct authority to make this decision. It is a board decision — you do not need a vote of all leaseholders, although good practice is to consult residents before making the change. If you are a leaseholder but not a director, your first step is either to become a director or to persuade the existing directors to act.
The Switch Process: Seven Steps
Find your termination clause
Before you do anything else, get a copy of your management agreement and find the termination clause. Look for the notice period (typically three to six months), the termination date (some contracts can only be terminated on the anniversary or the financial year end), any auto-renewal provisions, and any financial penalties for early termination. If the agreement has rolled into an auto-renewal period, you may still be able to terminate with the standard notice. If you cannot find your management agreement, ask the agent for a copy — they are contractually and professionally obligated to provide it.
Select your new agent before serving notice
Do not serve notice on your current agent until you have identified and provisionally agreed terms with a replacement. Running a building without a managing agent — even temporarily — creates insurance gaps, compliance failures, and contractor confusion. When evaluating agents, focus on:
- Who will be your named property manager? Not who runs the company — who will actually manage your building day to day? Meet that person before you commit.
- How do they handle handovers? A competent agent has a documented handover process. If they cannot describe it in detail, ask to see their handover checklist.
- What is their contract term? Be wary of agents who insist on multi-year contracts. A confident agent will offer a 12-month term with three months' notice — they expect to be judged on performance.
- Are they TPI-accredited and FCA-regulated? The Property Institute accreditation means they adhere to professional standards including handover protocols. FCA regulation is essential for insurance mediation.
- What is their fee structure? Management fees should be a fixed annual figure, not a percentage of service charge expenditure. Percentage-based fees create a perverse incentive to spend more.
Serve notice on the outgoing agent
Once your replacement agent is confirmed, serve written notice in accordance with the termination clause. Serve by recorded delivery or another method that provides proof of service. The notice should state the termination date, reference the specific contractual clause you are relying on, and request acknowledgement. Keep the tone professional — you need this agent's cooperation during the handover. If the relationship has broken down, consider having your new agent handle the correspondence from this point.
Communicate with leaseholders
Write to all leaseholders informing them of the change. The communication should cover the name and contact details of the new agent, the effective date of the switch, new bank account details for service charge payments once established, confirmation that service charge credits will transfer, and assurance that ongoing maintenance and contracts will not be interrupted. Your new agent should draft and send this letter on your behalf — it is their first act of management and sets the tone.
Manage the three-stage handover
This is where most switches succeed or fail. See the full handover stage breakdown below.
Verify the financial transfer
Service charge funds belong to the leaseholders, not the agent. All uncommitted service charge funds should transfer to the new agent's client account on or before the handover date. See the financial transfer section below for the legal position and how to enforce it.
Audit what you have received
Within the first 30 days under your new agent, verify everything required has been received. Use the audit checklist below.
Managing the Handover: Three Stages
The Property Institute standards establish a three-stage handover process. Your incoming agent should be driving all three stages — if they are expecting you to chase the outgoing agent yourself, that is a red flag.
| Stage | Deadline | What Transfers | Why It Matters |
|---|---|---|---|
| Stage 1 | Within 30 days of handover date | Leaseholder contact details, insurance policies, contractor and supplier information, health and safety files, fire risk assessments, building compliance documents | Without this, the new agent cannot manage the building safely. Insurance is the most urgent item — any gap in cover is catastrophic. |
| Stage 2 | On the handover date | Keys and fobs, tenant arrears statements, details of pending sales, transfer of all uncommitted service charge funds | Funds are the critical item. Without service charge money, the new agent cannot pay contractors or insurers. Section 42 of the Landlord and Tenant Act 1987 ringfences these funds as trust money. |
| Stage 3 | Within 90 days of handover date | Fully reconciled accounts with itemised accruals and prepayments up to the final date of management | This is how you verify the financial position the outgoing agent has left you in. Without reconciled accounts, you inherit unknown liabilities. |
A competent incoming agent will issue a formal Request for Information to the outgoing agent itemising every document, account, key, and data set that must be transferred. They should provide you with a written handover status update every two weeks until the process is complete. This is standard practice — not a special favour.
Verifying the Financial Transfer
Service charge funds held by the outgoing agent belong to the leaseholders, not the agent. Under Section 42 of the Landlord and Tenant Act 1987, these funds are held on trust. The outgoing agent has no legal basis to withhold them.
All uncommitted service charge funds should transfer to the new agent's designated client account on or before the handover date. Reserve and sinking funds transfer in full. The new agent should issue statements to all leaseholders confirming opening balances once the transfer is complete.
Your new agent should send a formal letter citing Section 42 of the Landlord and Tenant Act 1987 and the Torts (Interference with Goods) Act 1977, setting a firm deadline for transfer and outlining the consequences of continued non-compliance, including the right to seek an injunction. In practice, a well-drafted letter from a solicitor resolves most fund-transfer disputes within two to four weeks. It rarely needs to reach court.
The Post-Handover Audit Checklist
Within the first 30 days under your new agent, verify that you have received everything on this list. Anything missing should be formally requested in writing with a deadline.
What Goes Wrong — And How to Handle It
The outgoing agent delays the fund transfer
The agent sits on the funds, sometimes for months, citing 'reconciliation' or 'outstanding invoices'. The legal position is clear: service charge funds are held on trust under Section 42 of the Landlord and Tenant Act 1987. A well-drafted solicitor's letter demanding compliance under Section 42 and threatening injunction relief under the Torts (Interference with Goods) Act 1977 resolves most cases within two to four weeks.
The outgoing agent withholds documents
Documents relating to the management of the building belong to the management company — the RMC or RTM — not the agent. Retaining them can constitute a breach under the Torts (Interference with Goods) Act 1977. The same legal letter that addresses fund transfer should also demand delivery of all documents. If the agent is TPI-accredited, you can also escalate to TPI's complaints and disciplinary process — reputational consequences usually suffice.
There is an active Section 20 consultation
A change of agent does not automatically invalidate a Section 20 consultation that is already underway. A competent incoming agent can review where the consultation has reached, assess whether the process has been correctly conducted to that point, and continue it to completion. This is not a reason to delay switching — but it does require the incoming agent to have direct Section 20 experience. Ask specifically how they have handled mid-consultation handovers.
Leaseholders are confused about where to pay
Clear, early communication prevents this entirely. Your new agent should write to all leaseholders before the handover date with new bank account details and a clear instruction. For leaseholders on standing orders or direct debits, provide enough notice to change their payment details. Any payments made to the old agent's account after handover should be redirected — agree this in writing between outgoing and incoming agents before the handover date.
You do not need to wait for the financial year end to switch agents. A competent incoming agent will prepare opening balances from the outgoing agent's accounts and manage the transition cleanly at any point in the year. Waiting for year end often means enduring another 6–12 months of poor management for no practical benefit.
Ten Questions to Ask a Prospective Managing Agent
- Who will be our named property manager, and how many other blocks do they currently manage?
- What is your documented handover process and timeline? Can I see your handover checklist?
- What is your contract term and notice period?
- Is your management fee fixed or percentage-based? What is and is not included?
- How do you handle buildings with active Section 20 consultations or major works in progress?
- What is your approach to reserve fund planning and planned preventative maintenance?
- How do you communicate with leaseholders? What visibility do directors have into day-to-day management?
- Are you TPI-accredited and FCA-regulated?
- Can you provide two references from buildings of a similar size and type to ours?
- What happens if we are unhappy with the service in the first six months?
How We Handle the Handover
We have taken over buildings from agents who cooperated fully and from agents who withheld funds for months. We know the process because we have done it repeatedly.
- Free initial site visit and assessment. We visit your building, meet the directors, review the current management agreement, and give you an honest assessment of what needs to change — before you commit to anything.
- We manage the entire handover. We issue the Request for Information to the outgoing agent, track every item against our handover checklist, chase missing documents and funds, and escalate legally where necessary. You do not project-manage the transition.
- Fortnightly handover updates. You receive a written status update every two weeks until the handover is complete, showing what has been received, what is outstanding, and what we are doing about it.
- Leaseholder communication from day one. We write to all leaseholders introducing ourselves, providing new contact and payment details, and confirming the transition timeline.
- 12-month contract, three months' notice. We are confident in our service. We do not need long-term lock-ins to keep your business.
- No hidden fees. Our management fee is a fixed annual figure. No percentage-based charges, no surprise invoices for additional services.
Frequently Asked Questions
Ready to Make the Switch?
If you are an RMC director, RTM director, or freeholder who knows the management of your building could be better, the first step is a conversation. We will visit your building, review your situation, and tell you honestly whether switching would make a difference — and what the process would look like for your specific building.