Big changes announced for homeowners living in high-rise buildings

NatWest and Lloyds Banking Group (including Halifax, Birmingham Midshires, and Scottish Widows) have recently announced they will be changing their criteria in early 2023.

They will no longer require an EWS1 form on any blocks of flats over 5 storeys high for properties in England. This change is set to benefit thousands of homeowners living in England who live in a high-rise property with cladding that have been trapped unable to sell their property or even remortgage the property.

Their policy change has come around due the Building Safety Act 2022 meaning that leaseholders in buildings over 11m or at least 5 storeys tall are protected from the cost of removing unsafe cladding from the property. This change in legislation has led to NatWest and Lloyds Banking Group changing their policy with the knowledge that large costs to repair the property will not impact the property value in the future.

We are hoping that is the start of all mortgage lenders reviewing their policies around EWS1 requirements and will be able to offer even more options to our impacted clients.

What is an ESW1 Certificate?

An EWS1 certificate may be required if you are buying, selling, or re-mortgaging a flat in a multi-storey, multi-occupied residential building.

After the Grenfell Tower Disaster in 2017, fire safety rules were revised for high rise buildings with cladding. The Royal Institute of Chartered Surveyors (RICS) and mortgage lenders created the EWS1 certificate in 2019 to help mortgage lenders safely assess buildings.

Once a high-rise property has had a fire safety test (External Wall Fire Review), an EWS1 certificate will be granted. If remedial work is required, this can be costly and take a long term to take place.

There is guidance provided by RICS to surveyors as to whether they should request an EWS1 certificate depending on certain characteristics of the property. Where the surveyor believes that an EWS1 certificate is required, most mortgage lenders will not issue a mortgage, without a suitable EWS1 certificate confirming there is no remedial work required. This has resulted in thousands of people unable to sell or remortgage their property.