HOUSING ASSOCIATIONS are ‘struggl[ing] to cope’ with the ‘scale’ of the ‘crisis’ concerning the external wall review (EWS1) form, with some residents potentially ‘trapped’ in homes for years.
Recently, the housing, communities and local government committee (HCLGC) found that ‘fixing fire safety defects’ in high risk residential buildings could cost up to £15bn, and branded the mortgage industry’s cladding form ‘slow and expensive’, specifically the EWS1 process to help banks ‘make lending decisions on high rise properties with a potential fire risk’.
It asked for the government to step in, as not only was the process ‘not working’ but it should ‘take control’ by putting a ‘faster and fairer’ system in place, as the ‘industry-designed’ process was ‘slow and expensive’ and ‘applied to an unnecessarily wide range of buildings’. It also believed ministers should have ‘issued clearer guidance’ to mortgage lenders before advising on fire risk buildings.
The form, introduced last December, came from collaborations between mortgage and housing market trade bodies and industry experts, including UK Finance, the Building Societies Association and the Royal Insitution of Chartered Surveyors (RICS). It was intended to help ‘create a standardised process that would make it easier for brokers and homeowners to find suitable mortgages’.
A valuer could request it from a building owner or representative, and require a building professional to ‘confirm that the actual material on the walls posed a limited risk or was non-combustible’. Should it contain materials that ‘posed a significant fire risk’, a ‘detailed description of what was needed to fix it had to be issued’, but within a month brokers began reporting that lenders were rejecting mortgage applications.
This was because of ‘outstanding cladding inspections trapping borrowers with their current providers’, and so applications were being cancelled due to inspection requests – made to management and maintenance companies of high rises affected – being delayed. At the time, this related to ‘those qualified to issue the EWS1 certificate, the number of buildings that need to be inspected and the time needed to complete this review’.
HCLGC said there was a ‘lack of qualified, insured chartered fire engineers to undertake the required surveys’, so a ‘large number of buildings would not be inspected for many years’. The EWS1 surveys have also been expensive, with costs ‘typically passed to residents through their service charges even where no fire safety defects were found’.
As a result of fire safety advice from the Ministry of Housing, Communities and Local Government (MHCLG), ‘a much larger number of buildings’ fell into scope ‘than had been envisaged’, and ‘the process has lacked sufficient input from leaseholder representatives, but also other important stakeholders, including the insurance industry’.
RICS urged the government ‘to take greater ownership of the situation’, whilst also noting that ‘at least’ 860 EWS forms ‘have already been completed’, meaning homeowners in at least 800 blocks ‘have been able to buy, sell and remortgage or plan remediation works. EWS1 was created to find a solution to the problems caused in 18m+ tower blocks by MHCLG advice’.
MHCLG’s consolidated advice note in January 2020 ‘caused further significant confusion when it brought all buildings regardless of height into scope and added to the already known capacity issues with fire experts. RICS continues to call on government to take ownership and properly fund remediation works to all affected buildings. Only with a well thought out, government funded strategy, will leaseholders be able to live in safe buildings’.
Recently, Minister for Fire and Building Safety Lord Greenhalgh held talks with RICS to ‘attempt to resolve confusion’, and then Housing Minister Christopher Pincher stated mortgage lenders are reviewing how the forms are used, though some residents have been told by housing associations that they ‘cannot produce’ the EWS1 form for possibly ‘several years’.
Most recently, Mr Pincher admitted that there are ‘fewer than 300’ qualified chartered fire engineers who can undertake the EWS1 survey, and Inside Housing has reported that the ‘scale’ of the crisis means that leaseholders ‘could be left unable to sell or remortgage their homes for years’ as housing associations ‘struggle to cope’ with getting EWS1 surveys done on buildings.
The news outlet spoke to ‘dozens’ of leaseholders and shared owners who have been ‘unable to secure dates’ from associations for when checks would be undertaken ‘to satisfy mortgage providers’. Some associations have said homeowners ‘could be waiting for several years or even up to a decade’ for completed checks, with thousands of buildings in some cases requiring surveys, and an ‘increasing number’ of banks are requiring these before providing mortgages.
While the EWS1 form was set up for buildings over 18m, mortgage providers are now demanding them for buildings ‘well below that height, in some cases as low as 8m’, and in some instances housing associations have told leaseholders that checks are ‘unable’ to be carried out due to costs. One leaseholder in a block run by association Catalyst was told that ‘it would take a lot of time and resource, and as so, this means that many building owners […] cannot provide the forms’.
The association told Inside Housing that the block in question, in Willesden in London, was under 18m and ‘predominately made of brick’, so it ‘would not expect’ the EWS1 form to be required. The news outlet noted that the ‘impasse’ has seen the National Housing Federation (NHF) and the G15 group of housing associations pressure the government for new guidance to ‘overcome the current crisis’.
Some associations are ‘holding off’ until the guidance is clarified, with Hyde’s correspondence with one leaseholder stating that it was waiting for clarification before doing the checks, to ‘protect leaseholders from the costs’. An ‘increasing number’ of cases have seen associations pass costs onto leaseholders - Irwell Valley Homes told Inside Housing that ‘carrying out costly work that is not necessary and which leaseholders pay for, to satisfy mortgage lenders, is not the answer’.
L&Q has told leaseholders that ‘it will not be able to share’ inspection timescales for 191 buildings taller than 18m until September, and the ‘well over’ 1,000 buildings below 18m would not have a timescale until April 2021, with check completions ‘likely to take several years after that’. Peabody estimates it has over 2,000 buildings above 11m, and has told leaseholders it ‘could take up to 10 years’ for all to be checked and made compliant, costing £100m.
It told one leaseholder that one EWS1 check could cost £40,000, with an additional £57,000 required for scaffolding if intrusive checks were needed, while Inside Housing noted that delays ‘are further exacerbated’ by the aforementioned fire engineer shortage and the fact that, as Southern Housing stated, the process takes between ‘eight and 12 weeks’ on one building.
Victoria Moffett, NHF head of building and fire safety programmes, said that the issue is down to a ‘systemic failure of the building regulatory systems’, adding: ‘We’re working with the government and the wider industry to resolve the issues around EWS1 requests. In the meantime, we’re calling for the government to further increase capacity for conducting remedial works, and to consider how it can further support people to move home safely and confidently.’