9:41 AM, 27th May 2020, About 4 years ago 11
I have had an offer accepted on a modern (2009) flat, which I was planning to add to my rental portfolio. It’s on the middle floor of a small 3 storey block. However, I’ve now been told that the valuer cannot recommend that the mortgage company lend on the flat because of new certification requirements with regard to external walls.
Apparently all blocks of flats/residential buildings over 18 metres tall must have an EWS1 certificate to say that the external walls are compliant with certain standards, largely to do with fire safety. In January 2020 the advisory notice AN14 was issued, which states the government’s intention to apply it to all residential buildings containing more than one household.
However, because the whole building has to be inspected thoroughly for compliance, the process of getting EWS1 certification ‘costs thousands of pounds and can take months to complete’ (arma.co.uk).
The government have accepted a suggestion by RICS that an independent, licensed building inspector or fire inspector can certify the building as safe. However, professional indemnity insurers have been raising premiums hugely, or simply refusing cover to such inspectors altogether, meaning that many are refusing to sign EWS1 certificates because of the risk of exposing themselves to huge personal liability.
The builders (Taylor Wimpey) have stated that because the building in question here is not over 18 metres tall, and does not have cladding (it’s rendered) or any combustible add-ons like wooden balconies, it does not require EWS1 certification. However, because all such buildings are likely to need certification in the future the valuer is risk averse and the building society will not lend on it.
However, I’m inclined to think that even if I could get a mortgage now, the situation may make it impossible to sell the flat in the future, or there may be huge costs incurred to get the certification the next time someone wants to buy or sell a flat in the building.
This seems like a crazy situation. Although obviously there is a need to ensure that buildings are safe in the case of fire, post Grenfell, as it stands, this is going to make a large number of flats (my mortgage adviser reckons around 75%) un-mortgageable.
Editor’s Note: Click here for Council of Mortgage Lenders External Wall Fire Review Handbook