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Buildings with an EWS1 form still need remediation despite new government advice, says RICS

Low and medium-rise blocks which have received fire safety checks that state remediation is needed are still likely to need that work before banks will provide mortgages despite new government advice, the Royal Institution of Chartered Surveyors (RICS) has said.

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Low and medium-rise buildings with an EWS1 form still need remediation despite government advice, says RICS #UKhousing

The body representing valuers said buildings smaller than 18 metres that have already received an External Wall System 1 (EWS1) form which indicate remediation work is needed would still likely require that work to be done, as valuers have a duty to report to lenders any fire safety information that may affect the value of a flat.

The confirmation from the RICS comes a week after housing secretary Robert Jenrick told parliament that lenders should no longer ask for EWS1 forms on buildings shorter than 18 metres.

The announcement came after he received expert advice on the risk of buildings in the UK, which suggested that low rates of dwelling fires, deaths and blazes that spread beyond the room of origin meant “lenders should not be acting as if there was a widespread and systemic issue”.

The EWS1 form was created by the RICS in December 2019 as a way of unsticking the housing market after leaseholders living in buildings with potentially dangerous cladding were unable to sell due to banks being wary of providing mortgages.

The process requires a qualified professional to check a building’s facade and then an EWS1 form is produced to indicate whether remedial work is needed before a mortgage can be provided.


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When asked by Inside Housing what the impact Mr Jenrick’s new advice would have on blocks below 18 metres which already have forms that state work is needed, the RICS said it is likely these blocks could still need remediation.

It pointed to passages of its current guidance which state valuers must take into account all known information when valuing a property.

According to the guidance, this includes “considering an existing EWS1 form, even if one would not be requested under new guidance”.

The updated guidance, which was published in March, goes on to say: “Valuers must take into account all known information that would affect the value of a property.

“This would include an existing EWS1 form and the guidance will not therefore have retroactive effect for buildings that already have an EWS1 form.

“We recognise that this will lead to leaseholders in those buildings being treated differently from those in other similar buildings but we cannot advise valuers to disregard available information.

“We hope that emerging government plans to provide additional funds for remediation will help some of the leaseholders in this situation.”

This confirmation from the RICS means that many leaseholders in buildings whose owners have acted quickly to secure an EWS1 form could face bills of tens of thousands of pounds, while those that are still waiting for a check could end up being free from these bills.

Despite the government announcement last week regarding buildings under 18 metres, the majority of lenders have said they would not be changing their policies until the official guidance that states all buildings regardless of height must be checked is scrapped and the RICS updates its own advice.

The RICS said any change to its advice would need to go through a consultative process and would need to be reviewed and decided upon by an independent standards and regulation board to ensure changes were in the public interest.

Despite the government announcement calling for EWS1 checks to be scrapped for blocks under 18 metres, changes to fire safety legislation are likely to bring in requirements that will result in checks being needed that are akin to the current EWS1 system.

The Fire Safety Bill, which achieved Royal Assent in April, will require cladding checks to make up part of fire risk assessments for buildings in the future. A new standard, PAS9980, will also be introduced, with the government ensuring that fire risk assessments are consistent, proportionate to risk and actions to manage risk are cost-effective

However, Inside Housing has spoken to a number of fire safety experts who have suggested that these new risk assessments would effectively replace the current EWS1 form, with lenders still unlikely to provide mortgages if issues with a building’s facade are discovered during these checks.

An MHCLG spokesperson said: “The view from the independent experts is that there is no evidence of a systemic risk of fire in blocks of flats, but excessive industry caution is leaving many leaseholders in lower risk buildings unable to sell, or facing bills for work which is often not necessary.

“For those in buildings below 18m who have already received an EWS1 form, the expert advice strongly recommends that these cases are reviewed to prevent leaseholders facing bills for work where it is not needed.

"The Fire Safety Act will ensure that building owners or managers for residential buildings include external walls in their fire risk assessments. If the risks are low, then unnecessary and costly remediation works should not be recommended.”

 

Update 4/8/2021: A statement from MHCLG was added to this story.

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