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Government ‘has not made assessment’ of potential losses at cladded towers
The government has not made an assessment of its exposure to losses at a private estate in south London where values have plummeted due to flammable cladding.
Responding to a written question today, housing minister Dominic Raab confirmed 29 flats at New Capital Quay have Help to Buy equity loans which have been used to support the purchase, meaning the government owns a share of the equity.
Flats have reportedly plummeted in value at this estate, with at least one home owner buying out the equity loan at a fraction of its value.
The taxpayer would face losses if this was repeated and Matthew Pennycock, the local Labour MP, raised the issue with ministers last week.
In his written response, Mr Raab said: “Homes England has identified 29 flats where Help to Buy: Equity Loan held a share of the equity for the New Capital Quay development. Further work is ongoing to validate this information.
“The department has not made an assessment of the future valuation of such properties because it would rely on the individual situation and judgement of an independent valuer at the time the property owner decides they wish to redeem their equity loan.”
New Capital Quay, which has 980 homes across 12 blocks, features aluminium composite material cladding, similar to that used on Grenfell Tower, and Kingspan K15 insulation.
However the cladding has not been removed, amid an ongoing dispute between developer Galliard Homes (a subsidiary, of which is freeholder on the development) and the National House Building Council over who is responsible.
