RICS issues updated cladding guidance

The Royal Institution of Chartered Surveyors (RICS) has revealed new guidance relating to cladding.   The guidance will clarify which types of properties will, and will not, require additional inspections due to concerns about fire safety. The guidance is titled ‘Valuation of properties in multi-storey, multi-occupancy residential buildings with cladding’, and follows consultation with valuers, leaseholders, lenders fire safety experts and government. RICS will now work with the UK government and other stakeholders to ensure the guidance is implemented by 5 April 2021. In order to assist consumers, RICS will shortly produce consumer guidance to inform buyers and sellers about the information that might be available to help them understand the risks of a property in a multi-story, multi occupancy building. The guidance aims to create clarity and consistency about when a valuer is not required to request further investigation of cladding through an EWS1 form before valuing a property in a building of multiple occupation. As a result of the consultation, the guidance makes clear that where a valuer or lender can establish that the building owner has met the advice in the consolidated advice note, an EWS1 form should not be required. In addition, an EWS1 form would not be required for a building that is over 18 metres that has a valid building control certificate in place. However, safety requirements mean that not all flat-owners can benefit from this measure. While originally not proposed in the initial document, buildings of any height that have high pressure laminate (HPL) cladding and those of five storeys or higher with combustible cladding linking balconies will still need an EWS1 form. For buildings over six storeys, an EWS1 form should be required where there is cladding or curtain wall glazing on the building, as well as where there are balconies which stack vertically above each other and either both the balustrades and decking are constructed with combustible materials, or the decking is constructed with combustible materials and the balconies are directly linked by combustible material. For buildings of five or six storeys an EWS1 form should be required where there is a significant amount of cladding on the building; ffor the purpose of this guidance, approximately one quarter of the whole elevation estimated from what is visible standing at ground level is a significant amount. In addition, where there arethere are ACM, MCM or HPL panels on the building or there are balconies which stack vertically above each other and either both the balustrades and decking are constructed with combustible materials, or the decking is constructed with combustible materials and the balconies are directly linked by combustible materials. Meanwhile,for buildings of four storeys or fewer an EWS1 form should be required where there are ACM, MCM or HPL panels on the building. Dame Janet Paraskeva, chair of the RICS Standards & Regulation Board, said: “We recognise the significant distress caused to leaseholders struggling to sell flats in blocks with external cladding. “This announcement is a crucial step in unlocking the market, by ensuring that only those buildings where there are risks of costly remediation as a result of safety concerns from cladding are subject to additional checks. “The guidance is anticipated to result in a reduction in the number of EWS1 requests which will therefore allow more focus on the assessments of higher risk buildings, which should speed up the overall process whilst ensuring appropriate protection for lenders and purchasers." Ben Elder, head of valuation standards at RICS, added: “This guidance provides a framework for consistency across the mortgage valuation sector as to when an EWS1 form is required. “We are pleased to see, from the consultation responses, that many believe that the guidance will reduce the number of EWS1 forms requested. “We have reached our final position following very careful consideration of the evidence to ensure that buildings at higher risk of remediation work are appropriately investigated in the valuation process, to support reliable advice by valuers to their lender clients. “With the majority of lenders in support of the guidance, we now call on all UK lenders to support the guidance and work with their valuation providers to implement.” Housing Secretary Robert Jenrick added: “I welcome RICS new guidance which will mean nearly 500,000 leaseholders will no longer need an EWS1 form - helping homeowners to sell or re-mortgage more quickly and easily.

“We need a sensible, proportionate approach to risk and costs should only be incurred where they are absolutely necessary and less costly and intrusive mitigations can’t be put in place.

“Backed by nearly £700,000 government funding, over 500 assessors have now started training so that where valuations are needed these can be done more quickly, speeding up the process for homeowners.

“The government has also provided an unprecedented investment of more than £5bn to protect leaseholders from the costs of cladding remediation.

"And we expect building owners and developers to step up and pay for works on their buildings, as some are doing.”

John Baguley, director of technical, risk and compliance at Countrywide Surveying Services, said: “We welcome the move by RICS to bring consistency to the market. "The guidance is a welcomed step forward and should see a reduction in the volume of buildings requiring an EWS. We will be working with our lender clients on its implementation as we move toward the April implementation date”.