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Social Housing Speed Read – New EWS1 Consumer Guidance

The Law Society has recently published new guidance in relation to the sale and purchase of flats, designed to explain the risks involved in buying a leasehold flat; particularly in relation to building safety and cladding issues.

The guidance is not just relevant to individuals looking to purchase flats, but also those who develop, sell and own / manage blocks of flats.

Since the fire at Grenfell Tower, it has become increasingly important to consider any possible building/fire safety issues in flats. Particularly:

  • whether the flat is a safe place to live;
  • the possible costs of remedial works in relation to any fire safety issues;
  • the ease with which they will be able to sell the Property;
  • any fire safety or building work that needs to be carried out; and
  • any disruption which will be caused by remedial works.

There has also been a deluge of government advice and legislation, meaning that buyers must also be aware of:

  • the five-point plan for building regulation;

The Law Society’s new guidance is intended to provide some direction as to the information that should be provided when selling or buying a leasehold flat.

Issues to investigate

Before proceeding with a purchase, the guidance encourages buyers to enquire as to whether a fire risk assessment has been carried out, if any works are required to make the building safe, how much these works will cost, and who will be bear the costs.

Fire Risk Assessment

It is the “responsible owner” who should provide this assessment, which should identify the fire precautions which must be adhered to, to ensure compliance with the Government’s requirements.

The EWS1 form

This form provides information about the building’s fire safety rating and must be renewed every five years.

Both buyers and sellers should be aware of which properties require an EWS1 form and whether it applies to the property being sold. In July 2021, the Government published a ministerial statement and an independent expert statement suggesting that an EWS1 would not be required for buildings below 18 metres. This is not, however, law and evidence suggests that lenders continue to be cautious about properties with additional risk factors, even if they are less than 18m tall.

The fire safety rating of a building can be revised at any time; this may affect the buyer’s lender’s position and the buyer’s ability to proceed. It might also have an impact upon an existing owner’s ability to re-finance their property or block.

Government Grants

Pursuant to the Fire Safety Act 2021, the current position is that leaseholders who pay service charge will be responsible for covering the cost of remedial works.

The building may be covered by the Building Safety Fund however this will not cover the full cost of remedial works and in reality it appears this will apply to very few buildings.

The law and guidance around fire safety in blocks of flats continues to cause confusion and concern. However it is important that buyers, sellers and owners of flats continue to stay up to date with what remains a fast changing situation – by understanding their respective rights and obligations, buyers and sellers of flats stand a much better chance of being able to complete their purchases and sales in a way that is fair and transparent to both sides.

If you have any questions on the above and how it will affect social housing providers, or any other questions as a social housing provider, please do not hesitate to contact Simon Thirtle or a member of our expert Social Housing Team.

Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.

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