Last week, Housing Secretary Robert Jenrick MP announced an extra £3.5 billion to fund replacement cladding on high-rise buildings above 18 metres. Good news? Not entirely. Yes, this is a substantial amount of money and thousands of leaseholders will be hugely relieved to know that they no longer have the spectre of huge bills and unsellable homes hanging over them. But the announcement still leaves a lot of questions unanswered.
First, cladding campaigners and property industry commentators are unanimous in their verdict that the new fund, while very welcome, is not enough. Estimates nearer to £15 billion are thought to be realistic. And there was no mention of funding to tackle other fire safety issues, such as internal compartmentation, fire doors or combustible balconies. These will all be costly to fix. As the IRPM has pointed out, replacing the cladding without dealing with these other problems makes little sense. Second, buildings above 18 metres are not the only ones affected by fire safety problems. The Government says it will now provide long-term, low interest loans for leaseholders in blocks between 4-6 storeys, with no one paying more than £50 a month.
But why should they have to pay at all just because they live in a low-rise block that may only be a few feet below 18 metres? That’s £600 every year – possibly for longer than the mortgage term, depending on the size of the remediation bill. Try selling a flat with an ongoing debt attached to it. How can that possibly be fair? And what about the leaseholders who live on estates with one or two blocks that need remediation while theirs doesn’t. For some that means paying as per the lease schedule which might cover a group of blocks, when their block does not even have cladding. No doubt for all blocks of flats insurance will be affected as risks are perceived, again costing leaseholders additional money to insure their home even without the need for remediation.
Finally, developers will be expected to contribute to the cost of funding. But why single them out to fund repairs? Others in the construction chain are equally culpable for the issues that have come to light in the last three years and it seems wrong to insist developers shoulder the burden alone. So far as we have heard, these materials have still not been withdrawn from sale. You can still buy ACM cladding. Yes building regulations have been updated to make it clearer what the standards are, but as long as 'bad stuff' is for sale, someone will fit it. When asbestos was banned it was withdrawn from sale - why are we not seeing that here? Robert Jenrick claimed that the new measures will “remove unsafe cladding, provide certainty for leaseholders and make developers pay for mistakes of the past.” We welcome the additional funding but are disappointed that the government has still not got this right.
Mary-Anne Bowring FIRPM FRICS FARLA FCABE Founder/Head of Asset Management
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Ian Barber MD BTR Mobilisation & Leasing
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Jon Curtis MRICS Head of Building Engineering
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Kate Robinson MIRPM MD Blocks/FM Management (London Region)
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Lee Harle Partner Ringley Law
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Anthony Kingdon MIRPM AssocRICS MD Blocks/FM Management (North Region)
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Chris Georgalis MRICS Head of Commercial Valuation
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Libby Chen MSc Compliance Manager
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Dipesh Parekh Director PlanetRent
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