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‘Largest-ever’ investment announced to remove unsafe cladding

Wednesday 10 February 2021

Housing Minister Robert Jenrick has today, 10 February, announced the UK Government’s further plans to remove unsafe cladding by investing an additional £3.5 billion. Jenrick promises that the funding will ensure leaseholders in England in high-rise buildings above 18 metres will bear no costs in order to make them safe.

Where are we with the removal of unsafe cladding?

ACM cladding, which is by far the most unsafe form of cladding, has been remediated from 95 per cent of all high-rise buildings, stated Jenrick, and workers are currently continuing to remove the remainder of the buildings with the cladding present. 100 per cent of ACM cladding has been removed from social housing.

Levy and tax for developers

A ‘gateway to developer levy’ will apply to residential developers who seek permission to develop certain high-rise buildings in England. The UK Government shall consult on the policy design in the due course.

A new tax will also be introduced for the UK residential property development sector in 2022 which is expected to raise at least £2bn over the next ten years to help pay for cladding remediation costs.

Funding

Jenrick said that the risk in lower and medium-rise blocks of flats with unsafe cladding is a lot lower but costs can still be significant for leaseholders. To tackle this, he announced the UK Government will develop a long-term low-interest scheme to protect leaseholders for cladding remediation in buildings between four and six stories high. Leaseholders will not pay more than £50 a month towards the removal of unsafe cladding.

The support combined means the UK Government is providing more than £5 billion which includes the £3.5 billion announced today, plus the significant cost of the financing scheme to ensure all leaseholders in medium and high-rise blocks face no costs or very low costs if cladding remediation is needed.

EWS1 forms

Half a million leaseholders will also not need a separate EWS1 form to get a mortgage and the UK Government is asking lenders to strongly support today’s announcement so this part of the housing market can move forward.

On 21 November 2020, the UK Government announced that the External Walls Systems 1 (EWS1) form is no longer required for owners of flats in buildings without cladding to sell, rent, or re-mortgage a property, in an agreement reached with the Royal Institute of Chartered Surveyors (RICS), UK Finance and the Building Societies Associations (BSA).

Quote mark

Following the disaster of the 2017 Grenfell fire, it is welcome news that the UK Government is finally increasing funding for residents stuck in buildings with unsafe cladding in England.

We hope that extra funds announced today will make the process quick, efficient and cover the work needed to resolve any safety concerns residents face. Today’s announcement is just a start and the UK Government must now also commit to completely eradicating this type of cladding to keep the market moving and ensure all properties can be bought, sold and rented. Supporting our industry to deliver change is more vital now than ever, and it is encouraging to be one step closer to ensuring that people are safe within the confines of their own homes, as standard.

Mark Hayward

Mark Hayward
Propertymark Chief Policy Advisor

Propertymark's work on cladding and leasehold

Propertymark reported the effect of COVID-19 on leaseholders as they were forced to pay for waking watches and other security measures during the crisis on buildings where remediation work wasn’t complete. The introduction of the Building Safety Bill and action on mortgages for properties in high-rise residential buildings was announced in April 2020. Propertymark has long campaigned for leasehold reform, as many leaseholders have found themselves ‘mortgage prisoners’ with lenders refusing to value flats with unsafe cladding.

Leasehold properties

In September 2020, Propertymark submitted written evidence to the Housing Committee's inquiry into the Draft Building Safety Bill acknowledging and encouraging the need to improve building safety after the tragic Grenfell Tower fire, but stressed concerns about the practical application of the following elements contained within the Draft Building Safety Bill and costs to leaseholders. These included:

  • Recruitment, training and the role of Accountable Persons and Building Safety Managers
  • Gaps between the new Building Safety regime and legacy stock
  • Material information and the remediation of any unsafe cladding
  • Scope of the New Homes Ombudsman Scheme

Propertymark has also met with the Health and Safety Executive to discuss the implications of the new Building Safety Regulator and is part of a cross-sector group working on improving guidance for members who are buying, selling and renting property affected by cladding.

Propertymark resources

Login to your member area using the below buttons to access the Draft Building Safety FAQs.

ARLA Propertymark Draft Building Safety Bill FAQs      NAEA Propertymark Draft Building Safety Bill FAQs