Leaseholders of multiple properties must pay remediation work

During the Levelling Up, Housing and Communities Committee session on building safety remediation and funding, Michael Gove — Secretary of State for Levelling Up, Housing and Communities — confirmed leaseholders who own “a string of properties” would not be protected.

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Remediation funding

According to the Department of Levelling Up, Housing and Communities (DLUHC) there have been 481 high rise buildings identified as requiring remediation work in relation to ACM cladding.

Leaseholders, including those who are landlords by default, are to be protected under law from the costs of cladding remediation, with a cap of £15,000 for non-cladding related costs being applied in London and £10,000 for areas outside of London.

The cap considers any safety costs that have been incurred by leaseholders to date, including costs for actions such as the Waking Watch.

However, this protection does not extend to leaseholders of multiple properties as they have been viewed as being of significant wealth. Gove also highlighted the responsibility of freeholders to pay for building safety work.

Protecting landlords

The lack of protection for leaseholders that own more than one property signals broad assumptions have been made about the financial status of buy-to-let landlords.

Further investigation into extending the protections afforded to leaseholders was raised in the session, with Gove confirming that he would look sympathetically at any amendments put forward to the House of Lords on the matter.

Assuming that landlords with more than one property are ‘of significant wealth’ and therefore have the means to contribute without support could have a negative impact on the amount of time that it takes to make buildings safe and fail to restore full confidence in this area of the market.

So, while it’s a step forward to bring what the Secretary of State termed ‘landlords by default’ within the scope of the fund, the UK Government must get a better grasp of the sector as a whole and ensure that all landlords, who are also leaseholders, do not have to pay for a crisis that is not of their own making, regardless of their perceived financial status.

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Timothy Douglas Head of Policy and Campaigns | Propertymark