External Wall System Reviews – valuation of high-rise properties

We are continuing to engage with the government and stakeholders on the External Wall System Review process, designed to confirm the materials used in external wall systems on high-rise buildings, so that they can inform mortgage lenders’ valuation process.  

The industry-wide process was established in December 2019, and was intended to provide some clarity and consistency for the valuation of properties in high-rise buildings. This was in response to instances where properties had been valued at zero by surveyors, meaning that leaseholders had been unable to sell or remortgage their homes.

The introduction of the External Wall System (EWS1) form was designed to resolve this issue for properties in buildings over 18m, by requiring a competent professional to assess the external wall for combustible materials and provide confirmation for lenders, valuers, residents, buyers and sellers.

However, our members have reported a number of issues associated with the process. These include the lack of capacity and availability among the competent professionals required to carry out the reviews, as well as instances where reviews have been requested for properties in buildings below 18m. In addition, many of the fire engineers carrying out the assessment work are unable to secure the appropriate professional indemnity insurance needed to do so.

We are therefore working with stakeholders and the government to address the issues that underpin the form and to support solutions that would help deliver security and assurance for leaseholders. We are also engaging with the government to encourage policies that could speed up and facilitate the remediation of high-rise buildings with unsafe cladding, by providing coordination and resources.

We recognise that the form’s application is causing many challenges for our members with multi-occupied buildings. We are considering how else we can support members and affected leaseholders and we will share more details soon.