Since the introduction of the new government guidance, mortgage lenders have been asking leaseholders looking to buy, staircase or remortgage properties over 18 metres for clarification that their home meets the guidance, by providing a compliance document called an External Wall System form (EWS1). This document outlines if the building meets the recent government advice on external wall construction. In January 2020, the government changed the guidance and stated that all buildings of any height with cladding may need an EWS1 form - only those without cladding and some buildings that are 1-3 storeys are exempt.
EWS1 forms need to be completed by an independent fire engineer and surveying firms appointed by mortgage lenders use the information, alongside other factors to determine the value of the property and whether they’ll approve a mortgage loan.
Due to the approach that surveying firms and mortgage lenders are taking, this unfortunately means that it in some cases leaseholders are facing delays in selling, staircasing or remortgaging their home. We understand that this situation is incredibly upsetting and frustrating for leaseholders affected.
We understand the importance of this form, but for us to provide the evidence that the building meets government guidance, we need to undertake complex and detailed intrusive inspections of the building by specialist fire engineers, who are in short supply nationally. As part of the inspection, we have to open up multiple walls to check what materials they are made of, carry out safety checks and in some cases, complete remedial works.
Whilst it’s not a legal requirement, we’re working hard to complete these investigations for our buildings as quickly as possible. And we’re looking into options to see how we can speed this process up and complete these forms quicker, prioritised based on need. However, this is a complex and timely process and we therefore won’t be able to provide a valid EWS1 form for some of our blocks (particularly those under 18 metres) on request and in some cases for some time. There are also very few specialists in the country that have the ability to complete the form and they are in high demand.
Unfortunately, for some of our leaseholders not having an EWS1 form is causing delays in being able to progress with the sale of their home, remortgage of their home, or staircase of their shared ownership property. We want to do everything we can to support leaseholders whose mortgage application or sales process has been disrupted as a result of the approach that lenders are taking. As the form is only needed by mortgage lenders, this isn’t affecting purchases made by cash buyers.
This new guidance is affecting housing associations and building owners across the UK and we’re working together through the National Housing Federation to call on the government to work with mortgage lenders to find a solution that will enable the housing market to operate normally during the period of uncertainty. Over the coming months, we hope to be able to provide you with more information and reassurance as further guidance is announced by the government.
If you’re looking to staircase, sell or remortgage your house, please contact our Sales team for more information and support. We also advise you to seek advice from your mortgage lender before beginning the process and speak to an independent financial advisor. The Leasehold Advisory Service (www.lease-advice.org) and the Leasehold Knowledge Partnership (www.leaseholdknowledge.com) are potential sources of advice.