New guidance has been released from the Royal Institution of Chartered Surveyors on valuing properties in England of 11 metres and more in height.
Following the horrific Grenfell Tower fire, lenders tightened up the access to mortgages in flats over a certain height without EWS1 form. This has left many people unable to move in what many has described as mortgage prisoners as their flats have only been sellable to the narrow market of cash-buyers.
A huge issue with the guidance is that this has also impacted blocks which did not have dangerous cladding, but who needed an EWS1 certificate. We have elaborated in a previous post on why there have been several years worth of delay in being able to get an EWS1 certificate.
From the 9th of January 2023, new guidance will be in place to enable mortgage providers to lend on flats that have previously not been eligible. With lenders such as Barclays Bank, HSBC, Lloyds Banking Group, Nationwide Building Society, NatWest, Santander currently supporting the scheme.
It is estimated that 2mn property owners are mortgage prisoners who are unable to sell their homes because lenders refuse to lend to those interested in buying their flats because of concerns about cladding.
Financial Times, December 2022
What does this mean for the Southampton market?
There will be a significant amount of flats, in particular in the Ocean Village area, that now will be available to a much wider buyers-pool. We await and see what this will mean for blocks such as Moresby Tower, Sapphire Court, Hawkins Tower, The Blake Building and more – who up until now have only been available for cash-buyers.
We know this news will be welcomed by many prospective sellers and buyers although we have to wait until the new guidance is in place to fully understand the impact it will have on the market.
