One long running issue for homeowners in blocks with unsafe cladding has been the difficulty in selling and raising mortgages.
Banks have generally been unwilling to lend against impaired properties. As a consequence some homeowners have become “mortgage prisoners” and prospective buyers unable to find a mortgage.
Six UK banks have now committed to lend from the New Year, now the Royal Institution of Chartered Surveyors (RICS) has published new guidance on the valuation of affected buildings. Until now a lack of clear guidance had restricted the risk assessments which lenders need before offering finance.
HSBC, Lloyds, Barclays, NatWest, Santander and Nationwide Building Society have all agreed to consider fresh applications on buildings greater than 11 meters in height.
There are strings of course – the banks will need assurance that funding is in place to remediate building safety defects, for instance from the original developer or from government funding.
It is also uncertain how good intentions will play out on the ground – for instance, how rigorous risk assessments will prove to be.
RICS intends to monitor how positive the effects of its guidance prove to be.
All in all however this appears to be a welcome development which will help to unlock what has been a blocked market for too many homeowners.