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If you are buying or selling a flat, you might need to deal with a new health and safety aspect of the transaction – the EWS1. This form is the result of guidance issued by the UK Government concerning cladding on residential apartment buildings after the devastating fire at Grenfell Tower in June 2017. Although the guidance applies to England and Wales, the Scottish Government is currently referencing it until separate guidance for Scotland is published in Autumn 2020.
Both sellers and buyers of relevant properties in Scotland will be affected by this new process, so it is important to be prepared. Here, our Residential Conveyancing Solicitors provide essential information about the EWS1. If you have any questions about this matter, or on any other aspect of buying or selling your home, we would be delighted to help. Please do not hesitate to get in touch.
Following the UK Government’s guidance, many mortgage providers now require to see a report that certifies the safety of cladding on a building before they will agree to lend money. Until such certification is produced, lenders have instructed their surveyors to value the property at £0. This means that in many cases, sellers will now have to provide this report so that buyers can borrow money.
At first, there was uncertainty about which professionals could prepare the report, how much it would cost, and the length of time it would take to produce. To clarify these points and create a standardised system for certification, the Royal Institute of Chartered Surveyors (RICS) created the EWS1 form.
First, a qualified and professionally registered construction expert must inspect the external wall cladding system on the building to determine whether it poses a fire risk. If it is safe, this will be recorded on the EWS1 and the certificate will be issued to the seller to allow the sale of their property to continue.
If materials are found to be potentially flammable, an expert in fire engineering must carry out a further, more detailed assessment. They will certify whether the risk is low and, therefore, no remedial works will be required, or high and advise on the necessary changes.
The form is valid for five years, but it may need to be updated earlier if significant changes are made to the building’s external walls.
If the property you are selling is in a multi-storey residential building over 18 meters high* and has any type of cladding material on the external wall systems (including balconies), an EWS1 form may be necessary before mortgage providers will agree to lend money to buyers interested in your home. This applies to both older and new build properties.
*Please note - lower buildings with cladding may also be impacted from both a lending and safety perspective.
The cladding safety inspection process has, on the whole, been criticised for being expensive, time-consuming and disruptive. Specific concerns have been raised about the shortage of experts carrying out the EWS1 certification process, and there are still questions about who is in fact qualified to carry out this assessment. Further, we have seen reports of fraudulent EWS1 forms being produced.
In Scotland, the Ministerial Working Group on Mortgage Lending and Cladding was set up to develop solutions to the large number of people in Scotland having difficulty buying, selling and remortgaging properties with cladding. Proposals and recommendations on how these issues can be addressed are expected later this year. We welcome any improvements to the process that make it safer, cheaper and quicker for our clients.
It is not mandatory; however, if you are planning to sell a property covered by the EWS1 and you do not arrange for an inspection of the external wall systems, it could make it harder for you to sell as potential buyers may be unable to secure a mortgage.
At the moment, in Scotland, each owner is responsible for instructing a report. This means you cannot share the cost of a single report for the building with your co-owners. However, this aspect of the process is under review.
If you decide to commission the report, you may wish to wait until you find your buyer first and only take the step if necessary. For example, if you have a cash buyer, the form may not be needed. Your solicitor can advise on the best and safest way forward in your circumstances.
Co-owners may have to fund the remedial works to make the building safe, and you could find it very difficult to sell your property until these changes are complete.
You will need to contact a suitably qualified individual, who is a member of a recognised professional body, to carry out the initial assessment of the cladding. A list of appropriate professional bodies is provided in Annex 1 of the Local Government and Communities Committee Briefing; however, at the moment, there is no list of suitable professionals.
When instructing, it is vital to ensure the individual has adequate professional indemnity insurance cover. If you are unsure about whether the person you have arranged to carry out the EWS1 is qualified to do so, we can help you verify this.
The biggest problem could be that you are refused a mortgage for a property you want to buy if an EWS1 is not supplied or if a report identifies that cladding material on the building is not fire safe.
If the seller decides to instruct an EWS1 report, this could take some time to be finalised, causing delays to your transaction and increasing the risk of the sale falling through.
If you decide to buy without an EWS1 form, for example, if you are a cash buyer or your mortgage provider’s policy does not insist on this technicality, this could cause issues for you if you choose to sell the property in the future. Further, by then, the fire safety rules could be even more stringent.
You will likely be unable to secure finance for the property until remedial works are complete. As your Conveyancing Lawyer, we are unable to provide advice on the contents of the EWS1 – this must be given by the expert who carried out the inspection – but we can guide you on what your options are going forward.
If you have any questions about the issues discussed here, please do not hesitate to get in touch. Call us on 01555 662576 or complete our online contact form.
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