Low-risk flat rule change will allow millions of flat owners to finally sell
- 26th July 2021
- Selling Property News
Fewer flat buyers to face pre-mortgage cladding checks
The Government has finally reversed rules that required all buyers of flats to provide safety details on the property in order to get a mortgage. The decision should result in a flat selling resurgence.
About three million flats across the UK were estimated to be unsellable as lenders demanded details on the property’s external walls before they provided a mortgage. Buyers had to appoint an expert to assess the safety of the property’s external walls and then complete the EWS1 form which summarised the expert’s fire investigation report.
Some flat owners even had difficulty renting their properties because of the rules.
The Government extended its advice to smaller properties in January 2020, resulting in mortgage lenders demanding fire surveys from a greater range of sellers. The Government and major lenders have now agreed to end the need for these checks, following a review that found no systemic risk of fires in flats less than 18 metres high.
However, buyers of flats under 18 metres high still had to complete an EWS1 form.
Even houses without cladding have been affected, forcing prospective buyers to look elsewhere and leaving sellers saddled with their property that would have been effectively made worthless.
The decision to reverse rules on low-risk flats will come as an enormous relief to buyers and sellers and is likely to unlock one part of the property market that had been grossly underperforming in the last 12 months.
Major lenders have committed to reviewing their policies. Barclays, HSBC and Lloyds, among others, have all publicly come out in support of the policy change.
Stephen Ludlow, Chairman at ludlowthompson, says: “The Government’s decision to reverse these strict rules on low-risk properties is a welcome one. Many buyers and sellers had been greatly inconvenienced by these rules, making flats essentially unsellable and restricting property supply in a time when buyer demand is sky-high.”
“Some buyers of flats without cladding still had to comply with these rules. We are glad to see common sense prevail without safety being compromised, and can now expect a resurgence in the sale of flats.”
If you are considering selling your property, find your nearest ludlowthompson office and talk to us today about how we can help you achieve the best price and manage the whole sale for you.
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The Government’s decision to reverse these strict rules on low-risk properties is a welcome one. Many buyers and sellers had been greatly inconvenienced by these rules, making flats essentially unsellable and restricting property supply in a time when buyer demand is sky-high
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