Post-Grenfell, leaseholders who wish to sell flats in blocks with cladding are facing a whole new range of obstacles
The fall-out from Grenfell is now affecting buildings without combustible cladding. Despite Ringley and many other managing agents rushing to get cladding removed and buildings tested for free when the BRE were offering this service, blocks without combustible cladding are now also being impacted by lenders' in fear of building failure. As the BBC reported on Saturday, many flat owners in blocks around the country are finding themselves rendered powerless to get a mortgage as a result of the use of the EWS1 form.
The form is the outcome of new mortgage lender regulations post-Grenfell. The EWS1 form requires a "qualified professional" to carry out a fire-risk assessment and to either confirm there are no combustible materials present at the building or to recommend remedial works. This requirement is thwarting sales of properties in buildings over 6 stories, if a signed form cannot be provided. Remortgages are being denied. And, more cruelly still, lenders are increasing borrowers? mortgage interest rates until an EWS1 is provided.
The major challenge for any engineer or property professional is that, as we all know, more often than you would expect what is specified and what is actually used in the construction of a building, may be quite different. Not only are there lookalike materials and copycat imports out there but to the unwitting novice, or the person who puts profit over safety, there are materials from the same manufacturer that essentially look the same but have different fire class ratings and will perform differently in a fire.
What has changed most since Grenfell is that the focus is now on the 'total building system' not just the cladding. Yes, the cladding is still important, but no professional will sign an EWS1 form without knowing the combustibility of the insulation behind the cladding or even the combustibility of the glue and/or fixing compounds.
What this means is that we are now into a whole new testing regime. While the Hackett Review was limited to HRRBs (high rise residential buildings) many recommendations were framed as advisable for all buildings. And this is what, in part, the mortgage lending industry has done with the EWS1 form.
Developers are shying away from signing these forms, which is a shame as they ought to know or take responsibility for what they have built - although, arguably, perhaps the certification is safer if compiled independently of them. Freeholders are leaving it up to Resident Management Companies to arrange tests. And product-testing houses have waiting lists and long delays to get samples taken and tested.
In the meantime the innocent leaseholder suffers twice. First, flat owners are being hit by higher interest rates from their lender and second, they are now faced with increased service charge costs as the testing and a new fire risk assessment rarely leaves change from say £5,000. At the very least the government could outlaw the first of these pain points. And when it comes to the second, we strongly believe the cost of investigating building construction and determining how dangerous it is, should fall to the freeholder.
As is the norm, coping with the emotion, urgency and desperation now being experienced by leaseholders falls to the managing agent, as we try to coordinate testing and help innocent homeowners make sense of it all.
Author : Mary-Anne Bowring
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