Homeowners in dangerous buildings are being hit with crippling bills because ministers have ‘buried their heads in the sand’ since the Grenfell disaster.
About four million people are affected, with more than a million flat-owners paying £2.2billion a year for safety measures and extra insurance.
The scandal, which has left families stuck in fire traps facing repair bills of up to £115,000, threatens to wreck the housing market as a whole, with the flats becoming unsellable.
The Daily Mail today calls on ministers to fix Britain’s dangerous homes within 18 months and to spare leaseholders the crippling financial burdens.
We are demanding that repairs be completed by June 2022 and that the Government provide the necessary funding up front as soon as possible. Firms responsible for safety failures should also be made to pay their fair share.
The Mail’s campaign is backed by industry bodies and more than a dozen MPs from across the political spectrum.
Homeowners in dangerous buildings are being hit with crippling bills because ministers have ‘buried their heads in the sand’ since the Grenfell disaster
Tory MPs Stephen McPartland and Royston Smith are leading a backbench rebellion to ensure leaseholders do not have to pay for repairs.
Legislation to overhaul building and fire safety standards is expected to return to Parliament by the end of the month. The Draft Building Safety Bill, one of two on the issue, leaves leaseholders liable for the cost of fixing historical safety defects.
Hundreds of thousands of leaseholders in unsafe flats face average bills of £40,000 – and some of up to £115,000 – to replace dangerous cladding, similar to that found on Grenfell Tower in west London, where an inferno killed 72 people in June 2017.
They are already paying at least £2.2 billion a year between them while they wait for work to begin, the Mail can reveal, meaning homeowners are haemorrhaging an incredible £6 million for every day that work is delayed. Some have already been made bankrupt and handed back the keys to their flats.
The figure takes into account the cost of insurance hikes, 24/7 fire patrols known as ‘waking watches’, safety tests and new alarm systems – all paid for by leaseholders. But the true cost is likely to be far higher as the analysis does not include the costs of collapsed sales and mortgage rate increases caused by safety fears.
Insurance bills alone have increased by £1.6 billion a year – equal to the entire current Government fund for remediation work.
The analysis, carried out by the Mail alongside the Association of Residential Managing Agents and the Building Safety Register data firm, sparked calls for Government action.
Mr McPartland, the MP for Stevenage in Hertfordshire, said: ‘This is shocking evidence of leaseholders being left behind with many being forced into bankruptcy. The Government has to step in and provide a safety net.
Bronte Bailey, 25, says she cannot sleep at night for fear of a fire ripping through her eight-storey building in Southampton
‘It’s time [Housing Secretary] Robert Jenrick got out of his ivory tower, stopped talking and started helping. He could start by supporting the Mail’s brilliant campaign.’
Labour MP and public accounts committee chairman Meg Hillier added: ‘While the Government and professional bodies argue the toss about what to do, it’s leaseholders who are paying the crippling day-to-day costs of the biggest consumer and fire safety failures in a generation.’
Campaign group Grenfell United said: ‘We are proud to add our voices alongside thousands of leaseholders and tenants to this campaign. For over three years the Government has been burying its head in the sand about the seriousness of the cladding scandal and the thousands of unsafe homes across the country. The knowledge that another Grenfell-like fire could happen at any time keeps us awake at night. Only bold action from the Government can fix this.’
The Government says work is ‘progressing well’, but just 202 out of a possible 12,000 dangerous buildings have been fixed. Experts believe it could take another ten years to complete safety work at the current rate, despite MPs demanding it be completed by June 2022.
Meanwhile, 1.27 million private flats are currently unsellable due to clumsy attempts to resolve the crisis. New rules mean homeowners require a form to prove their building is free of dangerous cladding, but there are fewer than 300 qualified engineers to carry out the checks.
Leaseholders have been told they may have to wait up to ten years to get one, while low-risk buildings without cladding have also been caught up in red tape.
It means four million Britons could be directly affected by the crisis, based on average household size and including those in social housing. The number of affected properties accounts for 5 per cent of England’s private homes, and experts have warned it risks strangling the housing market. The Government has set aside £1.6 billion to fund the repair work, but MPs expect total costs to amount to £15 billion.
Leaseholders effectively rent their homes from freeholders, who own the land the properties are built on. But it is leaseholders who are legally liable to pay for repairs.
A Government spokesman said work was ‘complete or under way’ in 84 per cent of high-rise buildings with Grenfell-style cladding, although this does not include thousands of buildings with other types of dangerous defects.
He added that its priority was removing dangerous cladding and it was ‘considering a range of options to fund future remediation work’.
The Association of British Insurers said: ‘Some types of cladding present a greater fire risk, which has to be reflected in the cost of insurance.’
Hopes and dreams now left in ruins: Victims face bankruptcy and losing roofs over their heads
£310K FLAT NOW WORTHLESS
A pregnant mother says her family’s life has been put on hold after they discovered their home was a fire trap.
Laura Bell, 32, is expecting her second child in March and had been hoping to move to a bigger property with her husband James and their one-year-old daughter.
But in October she was told their two-bed flat in Penge, south London, was covered in dangerous cladding.
Laura Bell, 32, pictured, is expecting her second child in March and had been hoping to move to a bigger property with her husband James and their one-year-old daughter
It means the family cannot sell or remortgage their property, which is now effectively worthless. They bought it for £310,000 in May 2016.
Their building, Austen Apartments, which has 36 flats, now has a fire marshal permanently stationed in the entrance hall and a new temporary alarm system will be installed this month.
Commodities trader Mrs Bell said: ‘The emotional and potential financial burden is horrible. It’s really scary putting your children to bed at night in a block of flats you know is a fire risk.’
The new alarm system is set to cost around £81,000 for the block – £2,250 per flat – while the family may have to pay £30,000 to remove the cladding.
THE MAIL’S FIVE DEMANDS
1 The burden of paying for repairs to be lifted from leaseholders.
2 The Government to guarantee necessary funding will be available ASAP. Only the Government can provide comprehensive up-front funding – and work cannot begin in earnest until it does. Ministers can recover costs later.
3 Work to be completed by June 2022. Just 202 out of 12,000 dangerous buildings have been fixed since Grenfell.
4 Reduce the number of unsellable flats caught up in red tape. Thousands of low-risk buildings need forms to prove they are safe, but this could take up to ten years. Sensible guidance would allow homeowners to sell their properties again.
5 Ensure firms responsible for defects pay their fair share, minimising the burden on the taxpayer.
The owners of the flats do not qualify for the Government’s Building Safety Fund to cover the costs because the building is below 18 metres tall.
Mrs Bell said: ‘Some residents here have indicated that even an optimistic bill of £10,000 would be ruinous.
‘We did not design or build these buildings with cheap, shoddy materials. We do not own them and we were not the ones who falsely certified them as safe. We are the only party without blame here – the ones who acted in good faith, adhering to Government pressure to get on the property ladder. But we are the ones whose livelihoods are being sacrificed.’
WEDDING PLANS RUINED
An accountant has put her wedding plans on hold after she found out she faces a £43,000 bill for work on her building.
Lilli Houghton, 26, bought her flat in Magellan House, Leeds, with her boyfriend for £145,000 in July 2018. She said it was a ‘huge achievement’ for her to be able to buy her first property without help from her parents.
But a safety investigation later discovered flammable cladding, forcing her to pay an initial extra £960 in service charges.
She now faces a bill for almost £3,000 this month – and has been told the total cost of works for each flat could be as much as £43,000. She said: ‘I’ve been saving since I was 18 and I was able to buy my first property two years ago.
‘People are taught from a young age to save their money and get a foot on the property ladder. Now this is just a complete slap in the face. I am engaged and was looking forward to getting married, but now it seems silly spending money on a wedding knowing the costs coming my way.’
Miss Houghton also faces ‘crippling’ insurance bills. She had been due to marry her fiance Jon in March 2020 but the couple decided to postpone the wedding because of Covid. She said: ‘It’s a real shame – I’d been looking forward to a big wedding but now it doesn’t seem to make sense if we’ve got these big bills to pay.’
Lilli Houghton, 26, pictured, bought her flat in Magellan House, Leeds, with her boyfriend for £145,000 in July 2018
A teacher faces being made bankrupt and homeless after she was told she could have to pay up to £90,000 to fix serious safety issues in her flat.
Bronte Bailey, 25, says she cannot sleep at night for fear of a fire ripping through her eight-storey building in Southampton. She bought her flat at Sapphire Court for £220,000 last year and had been hoping to move out this year to start the ‘next stage’ of her life.
But in October a survey found the block, which has 110 flats, was wrapped in flammable cladding.
She faces having to pay up to £300 for a 24-hour fire patrol, known as a ‘waking watch’, until the building can be made safe. Miss Bailey also could face a bill of £90,000 to remove the cladding, while she says her insurance premium could rise by as much as 800 per cent.
Unless the Government steps in, she is currently liable for 100 per cent of the costs of correcting the problem, despite only owning 40 per cent of the flat through its shared ownership scheme.
She said she faces bankruptcy because the potential bills would eclipse her income.
She added: ‘It’s terrifying to live like this. I can’t sleep. I keep my keys next to my bed in case anything happens and I have to rush out in the middle of the night. I am stuck in an unsafe flat and unable to sell and move on with the property ladder for the foreseeable future. It is impossible to sell my flat until the enormous remediation work has completed which I cannot afford to pay on a teacher’s wage. I am now left to only declare bankruptcy and become homeless in the near future.’
‘ALLO, ‘ALLO! STAR’S FEARS
Actor Arthur Bostrom says the cost of fixing fire defects in his flat would wipe out a third of his retirement savings. Mr Bostrom, 65, who played Officer Crabtree in 1980s BBC comedy ‘Allo ‘Allo!, bought his apartment at Royal Quay in Liverpool for £260,000 last year.
But since March around 200 leaseholders at the seven-block development have been paying £32,000 a month for a 24/7 ‘waking watch’ after it was found to have dangerous cladding.
They will also have to pay £250,000 for a new alarm system, while their buildings insurance has been hiked from £86,000 to £300,000 a year. But the biggest cost will be removing the cladding, which could run to £50,000 each.
Actor Arthur Bostrom (pictured) says the cost of fixing fire defects in his flat would wipe out a third of his retirement savings
To make matters worse, five of the seven blocks do not qualify for Government funding because they are too small.
Mr Bostrom, lives in one of the ineligible blocks. He said: ‘It’s ridiculous. They all have the same cladding – they are just a slightly different height.
‘It’s the difference between having the work done for free and paying £50,000. I am an actor, mostly in theatre, so during the pandemic I have been unable to work.
‘I do have a private pension but, if forced to pay for this remediation, I would lose a third of my pension fund.
‘I paid off my mortgage years ago so I wasn’t expecting to have to put out for what is almost like another miniature mortgage. I am slowing down, but this means I will have to keep working.’
Mr Bostrom, 65, who played Officer Crabtree in 1980s BBC comedy ‘Allo ‘Allo!, bought his apartment at Royal Quay in Liverpool for £260,000 last year
Mr Bostrom said the freeholder, Liverpool City Council, rejected residents’ requests for funding and said they should pursue the building company.
But the original company went out of business after completing three of the blocks, while the rest were finished by another firm. A council spokesman said: ‘Although the council owns the freehold, there is a long leasehold interest in place.
‘The terms place responsibility for the repair and overall condition of the blocks with the management companies. ‘
He stressed: ‘We have offered to support an application by the management companies for a Government grant to pay for the replacement cladding.’
Staggering failures that left four million lives on hold over fire-trap flats
On December 16, Hayley Tillotson entered her bank in Leeds to return the keys to her flat. Days earlier, she had filed for bankruptcy.
Her mistake? Going to work, saving, and buying her first home in April 2019 for £101,750 with a £10,000 deposit. It took just 20 months for her to lose everything.
In July 2019, her building was found to be covered in dangerous cladding, similar to that found on the Grenfell Tower in west London.
On December 16, Hayley Tillotson entered her bank in Leeds to return the keys to her flat. Days earlier, she had filed for bankruptcy
In October, Miss Tillotson, 28, was told the block would need to be patrolled by fire wardens 24 hours a day, the cost of which often exceeded her mortgage payments. She would also be facing a £15,000 bill to replace the cladding, as well as costs to install fire breaks and replace wooden balconies.
‘I’ve no idea what the total figure is,’ she says. ‘I just know it’s unachievable.
‘I’ve worked hard and didn’t do anything to deserve going bankrupt. I thought I’d feel sad or angry, but I just feel broken and empty. Time and money ran out for me.’
So how on earth, three and a half years after the Grenfell tragedy, did we get here? Why have just 202 out of nearly 12,000 dangerous buildings been fixed, while more than a million flats are now unsellable?
And how has the Government allowed hard-working homeowners to go bankrupt through no fault of their own?
The answers reveal a breathtaking tale of ministerial inertia, incompetence and denial, which has put four million lives on hold.
Insiders say the Government’s first mistake was its failure to grasp the scale of the scandal. In the immediate aftermath of Grenfell, it insisted that the aluminium composite material (ACM) that spread the blaze was banned and the task was to identify a few outliers. But ACM had been permitted by regulators for decades and has since been discovered on 460 buildings.
The Government tripping over its own rules has been a hallmark of its response. Dr Jonathan Evans, chief executive of cladding supplier Ash & Lacy, was part of an advisory trade group formed by the housing ministry.
He believes if officials had accepted the scale of the problem, they might have acted to remove dangerous cladding straight away, rather than waiting to see how it could be replaced.
He adds: ‘That would have avoided all the waking watch [fire patrol] costs that crippled people’s finances and the anxiety that people have had for three and a half years.’
The Government’s second error was its refusal to accept that ACM was not the only problem. Independent fire safety consultant Stephen MacKenzie says experts were ‘lobbying like crazy’ for tests on other cladding systems, but officials feared a Pandora’s Box.
Testing on non-ACM was first promised in September 2017, but results were not published until July 2019.
A month earlier a fire almost destroyed Samuel Garside House in Barking, east London. The building had non-ACM timber cladding and was below 60ft (18m) in height, which exposed another flaw in the Government’s response. Buildings below this height have never been subject to restrictions on materials that could be used for cladding, meaning the number of affected blocks could be huge.
It took more than a year for ministers to accept that thousands of buildings with any number of defects were potentially unsafe.
But their next move was catastrophic for the property market.
Grenfell Q&A: Why can’t anyone sell their flat?
Why can’t anyone sell their flat?
Because of new rules introduced after the 2017 Grenfell fire. Banks will not lend on flats unless they have passed a test proving they are safe, but some homeowners are being told they may have to wait up to ten years to get one. The rules apply to about 1.2 million private flats, meaning at least 5 per cent of England’s private homes are unsellable. About four million leaseholders could be caught out, and experts say it could paralyse the housing market.
What are the rules?
The EWS1 (external wall survey) form was introduced in December 2019. It was designed to standardise checks and give lenders reassurance that buildings were safe to lend on. It used to apply only to blocks taller than 60ft (18m), but last January, Government guidance was extended to include buildings of all heights with any cladding, not just the type on the Grenfell tower. Blocks with no cladding are also caught by the rules. The EWS1 form simply indicates whether the building needs work or not. If it does, banks won’t lend. It means blocks with minor defects are as unsellable as those with serious fire risks.
Are these homes safe?
About 90 per cent of properties that have had an EWS1 survey have failed it. There are at least 839,000 leasehold flats in England with some form of cladding, according to Government estimates. Ministers believe about 11,700 buildings have combustible cladding, of which 1,700 are considered high-risk and in urgent need of repair. The Leasehold Knowledge Partnership (LKP), a charity, estimates there are 2.8 million private and social flats with potential safety issues.
What are the costs?
An EWS1 test can cost up to £50,000, depending on the size of the block. If it is failed, an explanation of the repairs is needed. The Government has set aside £1.6 billion to fund these, but the housing select committee says £15 billion will be needed. Campaigners estimate the average cost per leaseholder will be £40,000. Leaseholders living in dangerous buildings are already having to pay tens of thousands of pounds for fire safety patrols known as a ‘waking watch’ while they wait for repairs. Their insurance premiums have also rocketed by up to 800 per cent.
Who will pay?
As it stands, hundreds of thousands of leaseholders are liable for the costs. Some developers have promised to cover the costs in certain buildings, but it is a lottery. Many of the original developers have folded, while some argue their blocks were built within regulations and the Government has moved the goalposts. The Government says it will protect leaseholders from ‘unaffordable costs’, but the only definition it has provided is that this means no one should be made bankrupt. Meanwhile, the Government fund covers only buildings over 18m with dangerous cladding. That means leaseholders living in buildings under that height or with fire defects other than cladding are not covered. Even then, the cash is expected to cover only 600 blocks and will be doled out on a first-come, first-served basis.
What is the solution?
The Government is considering whether to allow leaseholders to pay costs over 30-year terms. But campaigners fear this would leave homeowners in negative equity while developers escape the burden. One proposal is that the Government lends funds to a special purpose vehicle to help repair buildings quickly.
Have any been fixed?
Flats with Grenfell-style cladding have been prioritised. The Government stumped up £600 million to pay for these repairs, and says remediation work has been completed on 202 of the 460 high-rise buildings known to have such material. The initial target for remediating these blocks was June 2020, but is now the end of 2021. Work has barely started on buildings with other types of cladding.
In December 2018, the Government published a document with the innocuous name ‘Advice Note 14’, which told building owners to remove all combustible materials from sites unless testing proved they were safe. It contradicted decades of official guidance, which permitted these materials on high-rise blocks.
Banks stopped lending on flats that were previously deemed safe and the market ground to a halt.
In December 2019, industry bodies developed the ‘EWS1’ form, which was designed to give lenders more confidence in providing mortgages on multi-storey buildings. But the Government then updated its advice in January to include buildings below 60ft. The number of affected flats rose from 307,000 to 1.27 million, with fewer than 300 qualified engineers in the country who could complete the forms. In October, the Mail reported that an estimated 30,000 sales had already collapsed due to the issue.
The biggest sticking point has been over who pays, which is wrapped up in who is to blame.
Fire safety laws mean building owners are responsible for making buildings safe, but leasehold law means leaseholders must pay.
It means a stalemate has occurred in which leaseholders are liable to pay but can’t afford to, while the Government wants building owners to pay but won’t make them.
And no money means no work.
On December 4, 2017, then-housing secretary Sajid Javid called on building owners to ‘do the right thing’ and not pass on costs to leaseholders. But Martin Boyd, former chairman of the charity, Leasehold Knowledge Partnership (LKP), says this was ‘always an utterly absurd statement’.
He adds: ‘One of the first things we told them was that you’re saying the building owner or developer must pay and the leaseholder mustn’t pay, but the law says exactly the opposite.’
Tribunals have consistently found leaseholders liable for millions of pounds of remediation work. Nigel Glen, chief executive of the Association of Residential Managing Agents, says the task has become wearisome.
‘We’ve had this hobby-horse for years,’ he says. ‘What lasts longer – a housing minister or a wine gum? We always have this huge churn of staff and politicians in the ministry. [Current housing secretary Robert] Jenrick has been almost invisible. We keep asking for a meeting to say we are the guys on the ground who are going to be charged with putting this right, and you just get nothing back.’
Previously, regulations simply said buildings ‘had to adequately resist the spread of flame’, but did not say how.
Guidance did allow certain combustible materials to be used on tall buildings – and while there have been cases of non-compliance, critics say it was still the Government’s responsibility to stop this.
Mr Boyd says: ‘Its backstop is to say, ‘somewhere in the legislation it says that you’ve got to make a building safe’. It doesn’t define what safe is. So the Government is just saying on the grounds that it now deems these buildings to be unsafe, the developers never followed the law. The developers’ defence is to say, ‘if we weren’t compliant with the regulations, how come it was all signed off as compliant?’
Dr Evans believes ministers must step up. ‘Nobody else has the pockets deep enough to fund quick and swift remediation,’ he says.
‘The Government refuses to accept it is a regulatory failure for which it is responsible. So the Treasury is asking why should taxpayers pay if industry has made such a mess of this?’ He believes remediation work may not be completed for another ten years.
Ministers say they have also secured an agreement that buildings without cladding do not need a form to sell or remortgage their property, but industry bodies have said the changes don’t work.
A Government spokesman said work was ‘complete or under way’ in 84 per cent of high-rise buildings with Grenfell-style cladding, rising to 99 per cent in the social sector. However, this does not include thousands of buildings with other types of dangerous defects.
He added: ‘We know many people are worried – which is why our priority is to remove unsafe materials as quickly as possible. We have already provided £1.6 billion to speed up the removal of dangerous cladding, announced an extra £30 million to help end the scandal of excessive waking watch costs and we are considering a number of options on how to fund future remediation work.’
While the arguments rage on, leaseholders lose out.
Miss Tillotson is sleeping on her father’s sofa with no idea of what the future holds. She points the finger of blame squarely at the Government.
‘They could stop it if they wanted, but they won’t and they don’t,’ she says. ‘I’ve got all these sanctions and restrictions. I probably can’t get loans, or a car, or have kids. I can’t be a normal person because of cladding.
‘Not because I’m a gambling addict or I drank all my money away. Just because of cladding. I’m not the first and I won’t be the last.’
Sir Peter Bottomley: Ministers must act now to end the misery
By Sir Peter Bottomley
Hundreds of thousands of leaseholders face ruinous costs if they are forced to pay for the mistakes of others.
But why? Two prime ministers, three secretaries of state and successive housing ministers stated leaseholders should not pay to make their homes safe.
Now, Parliament must ensure the Government indemnifies leaseholders from the costs.
It will take years to allocate blame and costs. The only certainty is that the leaseholders are innocent. Faults were made by regulators, governments, component manufacturers, designers, developers, builders and sales forces.
Listen to the heartbreaking testimony by the cladding groups in the North and the Midlands. Hear the evidence by the National Leasehold Campaign.
‘Buy your own home!’ Buy? No. The more accurate description is lease-renter. Pay for a lease to own nothing except the possible liability to pay for the actions, decisions and sometimes the greed of others.
In law, a leaseholder is the most vulnerable type of tenant.
The social tenant is protected. The private tenant can leave liabilities behind by moving away at the end of the rental period.
After the Grenfell tragedy, many leaseholders consulted the Government-funded Lease advisory service. Some were advised to go the property tribunal for protection against the costs of replacing dangerous cladding systems.
The campaigning charity Leasehold Knowledge Partnership knew better. Feudal lease terms, as if carried forward from the time of William the Conqueror, could not protect the vulnerable leaseholder.
Nearly three years ago, I warned that instead of waiting for years for an inquiry to reach conclusions, the Government should have a round-table meeting in the open with the landlords, the builders and representatives of leaseholders.
It is time to settle on simple, effective ways to remove and replace products that still endanger residents in blocks of flats. Make funds available at once so each block is made safe. End the costs of expensive ‘waking watch’ fire patrols. Make homes safe and saleable.
The responsibility for paying should be apportioned later between those who caused the disaster. The only condition is that the leaseholder is recognised as not responsible.
Can we trust the Prime Minister and ministers to achieve justice? They must stick to their words.
Months ago, the National Audit Office stated that the pace of progress lagged behind the ministry’s own expectations, particularly in the private residential sector. That is why it’s so vital that all buildings are now made safe for residents.
No leaseholder, lease-renter, should suffer anxiety facing costs well beyond their ability to pay. For there are huge sums involved here: replacing unsafe cladding on buildings may total £15 billion, nearly ten times the funds now available.
Just 202 dangerous buildings have been fixed completely so far, but the Government’s own estimates suggest there could be 11,760 in total.
Until this problem is fixed, people will continue to suffer. Meanwhile, every constituency has flats which have become a frozen part of the housing market.
Both ethically and politically, the Government must act now to fulful its promises.
Sir Peter is Father of the House of Commons and Conservative MP for Worthing West