Hope for ‘worthless’ flats with new EWS2 form but owners still face huge cladding repair bills
Homeowners in low-rise blocks of flats could be freed from controversial rules that have caused banks to value their properties at nil.
Telegraph Money understands the Royal Institution of Chartered Surveyors is working on a new form to help people wrongly caught up in tighter safety regulations introduced in the aftermath of the Grenfell fire in 2017.
Owners of two, three and four-storey buildings across the country are being forced to comply with fire safety rules intended for much taller blocks. Banks have refused to offer mortgages on these properties without a certificate that proves the building is free of dangerous cladding, despite there being far fewer fire safety concerns for low blocks.
Homes in buildings without a valid External Wall Fire Review (EWS1) form have been routinely valued at zero by surveyors.
Residents have been left in a situation where their homes have failed high-rise cladding safety tests, even though they live in small blocks that have little or no cladding. This has caused a logjam in the property market as flats cannot be bought or sold until the problem is resolved.
The certificates demanded by banks are under review, Telegraph Money can disclose. Rics, one of the trade bodies behind the form, is considering how it can overhaul the EWS1 regime. One option under consideration is a new EWS2 form for buildings less than 18m (59ft) tall.
This would allow property transactions in smaller, safer buildings to restart while more dangerous high-rises wait for further assessment. Another option is to restrict the EWS1 tests to buildings over a certain height, as was originally intended.
‘It's been a nightmare’
Chris Gore, 35, lives in a four-storey block in South Norwood, south London, with his wife, Maxine. The couple recently had a property sale fall through because they did not have a valid EWS1 form. Yet the only cladding on their building is on the fourth storey, meaning there is minimal threat to their ground-floor home.
The building is three years old and passed all necessary safety checks at the time of construction.
“The goalposts have been moved,” said Mr Gore. “We’re under the [18m] threshold and the flat was perfectly fine when it was built. Now I can’t remortgage or sell, unless I sell to a cash buyer, who will want a £100,000 discount.”
The Gores contacted the developer that built their block to find out whether the cladding used on the building was safe, but the firm said it was unable to locate this information. The couple have been forced to delay starting a family until they can move into a bigger home. “It’s been a nightmare,” said Mr Gore. “We want to take our next step in life.”
Jon Curtis of the property firm Ringley Group, who advised the Government on the introduction of the EWS1 regime, said the form was not being used correctly and talks were being held over its future. “The EWS1 was intended to help people in high-rise buildings, but the lenders have bastardised it and used it throughout the market,” he said.
The EWS1 form was introduced last December by Rics and UK Finance, which represent surveyors and lenders. It was supposed to help banks to identify potentially unsafe high-rise buildings, but lenders have demanded the form for modern blocks of all heights.
Mr Curtis said the 18m limit had been established because it was the maximum height that standard fire engines could reach, making it unnecessary to apply the rules below that level. In one case Mr Curtis said a bank had asked for an EWS1 form on a low-rise property with a brick exterior, tiled roof and no cladding. The forms cost thousands of pounds and it is difficult to find qualified professionals to fill them in.
Rics would not say when its proposals would be published. A spokesman said: “We are working on a review of EWS1 and guidance generally with a range of industry stakeholders. Any changes made as a result of that review will still have to follow the most up-to-date government advice.”
Leaseholders have been left fearing large bills if their properties are found to have dangerous cladding. This week Lord Greenhalgh, the building safety minister, said residents would have to foot some of the bill. Clive Betts, who chairs the cross-party housing, communities and local government committee, described this as a “significant change” in the Government’s position.
In July, Christopher Pincher, the housing minister, said the costs should be met by the developers or building owners and “certainly not leaseholders”. In 2018, Theresa May, prime minister at the time, said remediation costs should not be passed on to leaseholders.
Those in smaller blocks still fear they could be left with huge repair bills. They have no access the Government’s £1bn building safety fund, which is restricted to buildings taller than 18m.
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