British banks agree on disguise to make property sales easier

Hundreds of thousands of UK tenants trapped in apartments due to the building security crisis may be able to sell their homes soon after the government reaches an agreement with leading high street banks that will allow them to resume lending.

The move is the latest attempt to address what Housing Secretary Robert Jenrick on Wednesday called a “market failure” triggered by the 2017 Grenfell Tower fire that killed 72 people.

Hundreds of thousands of houses have become unsaleable for safety reasons since the fire. In an effort to free the market, Jenrick announced that any building less than 18 meters high would not require an “EWS1” fire safety form and should be considered safe by fire risk assessors and mortgage lenders.

This effectively reverses the government policy from January last year that “buildings of any height” should be screened for fire hazard – a move that inadvertently expanded the scope of the crisis to around 840,000 homes, according to government analysis.

Since the publication of these guidelines, which are now being withdrawn, lenders have been reluctant to offer home mortgages that could be considered unsafe, regardless of the amount.

Ministers have been desperately trying to thaw the market and this month Prime Minister Boris Johnson and other key number 10 officials met with senior executives at UK’s top lenders to discuss how to resume lending to affected homes and make it “more proportionate.” “Approach could take risk.

HSBC, Lloyds and Barclays, three of the UK’s largest lenders, welcomed the intervention, saying they expected to drop the requirement for EWS1 forms for blocks under 18m. Lloyds said he expected the move “will help further develop the housing market”.

Jenrick said the announcement was “a significant step forward for tenants of medium and low-rise buildings who have had difficulty selling, fear of potential renovation costs and concerns about the safety of their homes.”

“Tenants cannot get stuck in homes that they cannot sell due to excessive industry caution,” he added.

Some tenants have been forced to pay tens of thousands of pounds for temporary security measures like “security guards” who patrol vulnerable blocks 24 hours a day while waiting for confirmation of the security of their buildings.

Jenrick’s intervention is unlikely to satisfy building security activists and tenants, who argue that fire safety should be a top priority even when disaster risk is relatively low.

Kate Henderson, executive director of the National Housing Federation, which represents housing associations, welcomed the announcement but said “the safety of residents must remain a top priority”.

Additional coverage from Stephen Morris

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