A leading property solicitor has warned that the industry must put pressure on lenders to take a more reasonable approach to ESW1 certificates, the controversial certification framework brought in during the post-Grenfell cladding crisis.
Susanna Caulfield is a senior associate in the Real Estate Group at Rosling King LLP. She says the government’s External Wall Survey (EWS1) certificates, backed by RICS, were introduced with good intentions to help lenders value properties if fire risks were identified or compliance with government guidance could not be proved.
These initially applied just to those with problem cladding over 18 metres tall, although those under this height were later brought into scope.
But ESW1 forms have “subsequently became a source of greater confusion, with flat owners from any high rise finding themselves at risk”,” she says.
Last month RICS issued new, narrower guidance aimed at significantly reducing the number of buildings that require the controversial form.
“While there is now more clarity as to what the guidelines are for buildings of various sizes, the guidance is not statutory, and banks can decide for themselves whether or not to adopt it,” says Caulfield.
“UK lenders are being urged to support the guidance and work with their valuation providers to implement them in order to reduce the number of unnecessary requests for EWS1 forms.
“The guidelines provide a clear criterion for valuers to follow but there are many examples of lenders requiring EWS1 forms for buildings not included by the RICS guidance.
“This has led to a rapid increase in demand for EWS1 forms, even for low-rise buildings, which has not been met with a ready supply of qualified surveyors.”
Caulfield says that while the ESW1 process was introduced with the intention of adding some consistency and clarity to the valuation of property with regards to external wall safety, it has been difficult to achieve in practice and the “non-statutory nature of the regulations means some uncertainty will remain”.
Which properties need an ESW1 form?
As of now, the RICS guidance is as follows…
For buildings over six storeys, an EWS1 form should be required where:
- there is cladding or curtain wall glazing on the building, or
- there are balconies that stack vertically above each other and either both the balustrades and decking are constructed with combustible materials (e.g. timber) 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 EWS form should be required where:
- there is a significant amount of cladding on the building (for 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), or
- there are ACM, MCM or HPL panels on the building, or
- there are balconies that stack vertically above each other and either both the balustrades and decking are constructed with combustible materials (e.g. timber), or the decking is constructed with combustible materials and the balconies are directly linked by combustible materials.
For buildings of four storeys or fewer, an EWS form should be required where:
- there are ACM, MCM or HPL panels on the building.
Susanna Caulfield is a senior associate in the Real Estate Group at Rosling King LLP. Her experience involves acting for developers in the acquisition and disposal of development land, in both the commercial and residential sectors.