Managing agent

An agent acts for its client, not for the leaseholders, although its fees are usually paid from the service charge. People often say "management company" when they mean the managing agent, which causes confusion with a residents' management companyResidents' management company (RMC)A company, usually owned by the leaseholders, that is named in the leases as responsible for managing and maintaining the building, whether or not it also owns the freehold..

What agents usually do

Collect service charges, prepare budgets, arrange repairs and contractors, handle insurance, keep accounts, run Section 20 consultations and deal with leaseholders' questions. The company that hires them stays legally responsible.

Rules that apply to agents

• In England, anyone doing property management work in the course of a business must belong to a government-approved redress scheme.
• The RICS Service Charge Residential Management Code sets the standard expected of anyone managing residential blocks, agents included.

Self-managing instead

Directors of an RTM company or residents' management company can run the block themselves, hire an agent for everything, or hire one for particular jobs only (such as accounts or major works). An agent's contract lasting more than 12 months may need Section 20Section 20 consultationThe legal process of consulting leaseholders before carrying out works, or signing a contract of more than 12 months, that will cost any one leaseholder more than the set threshold. consultation. See Managing agent or self-manage?.