Flat Management Company

Flat management companies are widely used for storing the freehold interest in a property and also provides amenities to the residents of the building. The residents act as the flat management directors & shareholder and normally every person acts as the director of allocating one share to themselves.  

The most significant advantage of this structure is that the directors can very easily manage the business of arranging facilities to the  building areas.  In case the residents wish to sell their property then all they need to do is transfer their share to the flat management company. The introduction to allow leaseholders to buy and manage the freehold interest in their property has lead to the increase in the number of flat management companies.

There are a few provisions in the Commonhold and Leasehold Reform Act 2002 that has proved beneficial to the leaseholders. The right to extend immediate short leases has added to the benefit of the occupiers who would eventually consider managing the freehold for their own benefit. 

In order to set up a flat management company, the expenses incurred to maintain the areas and a manner in which suppliers and services are brought would be managed and taken care by the residents. The degree of accountability has increased but at the same time the cost associated with their provisions has reduced.