FPA Highlights The Mismatch Between EWS1 Guidance And Implementation

Housing Committee Chair, Clive Betts MP sets out his concerns about the gap between the guidance for external wall surveys and the reaction of mortgage lenders to their implementation, which is leaving leaseholders to face the consequences.

Issues with the EWS1 process

The Chair of the Housing, Communities, and Local Government Committee, Clive Betts MP, wrote to the government on 21 May to highlight continuing issues with the EWS1 process.

This follows the publication of guidance in March by the body responsible for chartered surveyors (RICS) which set out the criteria to be used by valuers to decide whether an external wall survey (EWS1) is required for a building.  

support valuation advice

A valuer should always have a rationale to justify the request for an EWS1 form"

The EWS1 form was introduced to support valuation advice and lending decisions in respect of buildings with cladding.

Mr. Betts's letter refers to a section of the RICS guidance where it states, “A valuer should always have a rationale to justify the request for an EWS1 form.”

role for government

He explains that leaseholders have contacted the Housing Committee to say that mortgage lenders are insisting on EWS1 forms in cases where the property does not meet the criteria set out in the guidance.

Clive Betts MP stated, “As a Committee, we recognize that the EWS1 process is industry-led. Nonetheless, there is a role for government in supporting the successful operation of the process to ensure it works for all stakeholders.”

RICS criteria

Mr. Betts concludes his letter by asking that the government respond to his letter and set out:

• The ways in which the government is supporting the implementation of the new guidance from RICS.
• The actions that the government plans to take in the event that mortgage lenders continue to insist that EWS1 forms are obtained for buildings that do not meet RICS criteria.

letter Publication 

As ever it is the leaseholder left facing the consequences, trapped in homes they cannot sell or remortgage"

In a news article to accompany the publication of the letter to the Secretary of State, Mr. Betts said, “As it stands the EWS1 system simply isn’t working. Industry guidance has set out which buildings don’t need the form, but it seems lenders are ignoring this and are opting not to provide finance without it."

He adds, “As ever it is the leaseholder left facing the consequences, trapped in homes they cannot sell or remortgage."

plans to step in

Clive Betts MP continues, "Following my appearance on Moneybox to discuss this issue, I have been contacted by leaseholders who find themselves, through no fault of their own, in this distressing situation."

He concludes, “We need to hear urgently about what the government plans to do about this. I have written to the Secretary of State, asking him to set out how the government plans to step in and end this mismatch between guidance and implementation.”