Government announcements for building safety
On 8 March 2021, the Royal Institute of Chartered Surveyors (RICS) issued new guidance relating to EWS1 forms. This guidance becomes effective from 5 April 2021.
The guidance is produced to assist lenders in understanding when an EWS1 form is required. The removal of some buildings, from the need for an EWS1 form, should assist those looking to move, remortgage or staircase.
We will be consulting with the Government, and our industry partners, to clarify our understanding of the impact on our buildings.
In the meantime, it is important to note that EWS1 forms are not a legal document and are required by mortgage lenders solely for the purpose of assessing the value of a property. How lenders approach the use of EWS1 forms is at their discretion.
For this reason, if you have previously been asked for an EWS1 for your building, but believe it may now be exempt, please contact your mortgage lender in the first instance.
You can view RICS’ announcement, along with a number of case studies and tools to help valuers, by visiting the RICS website.
This announcement does not affect our programme of building safety inspections as these are still necessary to ensure that our homes meet current building safety guidelines.
L&Q response to Government announcements on funding for building safety.
On 10 February 2021, the Government announced additional funding to support the removal of dangerous cladding from tall buildings. The new £3.5bn of funding is in addition to the existing Building Safety Fund of £1.6bn, bringing the total available to £5bn.
The Fund is only available for cladding works on buildings over 18 metres in height, so Government also announced that it would be providing financial support for residents of buildings between four and six storeys high by developing a long-term, low-interest loan scheme. As part of the scheme, leaseholders shall not pay more than £50 a month towards the removal of unsafe cladding.
To help fund these measures, the Government are planning to introduce a developer levy that will apply where developers seek permission to construct certain types of high rise buildings in England, and a new tax for the UK residential property development sector.
L&Q welcomes the news that more money is being made available for the remediation of dangerous cladding and looks forward to receiving additional detail about these funding measures. However, there is still a lot of work to do to make all affected homes safe which will take time to deliver.
At present, the new funding offer only covers the removal and remediation of cladding. It does not cover the remediation of any other building defects that might contribute to an apartment block not meeting new building safety guidelines, such as issues with cavity barriers (which restrict the movement of fire and smoke within a building) or the materials used in balcony construction.
We therefore recognise that many of our affected leaseholders will be disappointed with these announcements.
L&Q has committed £250 million to building safety works over the coming years and has launched one of the UK’s largest building safety inspection programmes. We have already protected leaseholders from over £20m of costs, by not charging for Waking Watch and fire detection systems.
As a registered charity, all of the money we make is reinvested back into our social mission, so unplanned, expensive building safety costs have the potential to severely impact this. We would welcome further government support to protect all affected leaseholders from costs and protect housing associations’ ability to continue investing in much-needed social homes.
We will be working with Government and our partners in the sector to try and find additional funding solutions to help solve the cladding crisis for residents of all tenure types. In the meantime, we will continue to make applications for the Building Safety Fund where possible.
In the absence of further support from Government, we have committed to exploring all options for the funding of non-cladding works and works on buildings below 18 metres high, before considering whether to pass costs on to residents. This will include investigating the possibility of seeking compensation from, making an insurance claim against, or requiring that the remedial works are done by the original developer/contractor.