The Week That Was - 7 October 2022
Welcome to The Week That Was, a round-up of key events in the construction sector over the last seven days.
New RICS guidance on the valuation of residential buildings which require cladding repairs
On 3 October 2022, the Royal Institution of Chartered Surveyors (RICS) published new draft guidance on the valuation of residential buildings in England that are either 5 or more storeys, or 11 metres, high. The guidance adopts a 'risk based and proportionate' approach and is intended to help valuers value properties in multi-storey residential buildings where "remediation work to cladding for fire safety purposes has been identified, a route to funding remediation is clear and lenders have indicated their willingness to lend". The draft guidance is open for public consultation until 31 October 2022.
For further information, please click here.
Multi-occupancy buildings insurance market faces potential reform
The Financial Conduct Authority (FCA) has undertaken a review process of multi-occupancy residential building insurance, resulting in a range of recommendations and potential remedies to give these leaseholders greater protections in the market. The review unearthed a reduction in supply in this area between 2016 and 2021 and an 125% increase in the average price of premiums. Recommendations include increasing the information available to leaseholders on the pricing of their insurance and improving the ability of leaseholders to challenge the high insurance costs passed onto them. An update on the progress of the review will be provided by the FCA in six months' time.
For further information, please click here.
Government to review net zero climate commitments
On 26 September 2022, the Government announced that it is going to review the Net Zero Strategy which was published in October 2021 and called 'Build Back Greener'. The strategy sets out a pathway to the UK achieving net zero greenhouse gas emissions by 2050 and includes measures to improve reporting on embodied carbon in buildings and infrastructure with a view to exploring a maximum level for new builds in the future, the development of a roadmap to increase the use of timber in construction and building skills for net zero. The Government says the Russian invasion of Ukraine and other global factors have fundamentally changed the economic landscape in the UK, placing huge pressure on households and business through high energy prices and broader inflationary pressures. The review will be led by Chris Skidmore MP, and it will produce a report including a set of recommendations which will be submitted to the BEIS Secretary of State by the end of December 2022. The Government says it will publish the review's findings.
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Labour confirms planned investment in green infrastructure
During Labour leader Sir Keir Starmer's speech at the party's annual conference, he promised to place green infrastructure investment at centre-stage if they were put into government. He promised to create a publicly owned company to fund green energy projects within his first year in office. This commitment to turn the UK into a 'green growth superpower' was echoed by shadow chancellor Rachel Reeves during her address. The plan includes spending £2bn on eight gigafactories (factories that manufacture batteries for electric vehicles) across England and investing £3bn in four locations in England and Wales to set up "clean steel" plants.
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Mortgage withdrawals cause house prices to stall
Figures from Nationwide Building Society show the annual rate of house price increase dipping below 10% for the first time in nearly a year, across 10 of the UK's 13 regions. Property price portal Zoopla warned that reductions in asking prices are at their highest levels since before the COVID-19 pandemic. Figures come amid increasing fears over house pricing falls following the withdrawal of 41% of all UK mortgage productions and many major lenders making loans much more expensive. As a result of these movements, shares prices in Barratt, Taylor Wimpey and Persimmon are down by between 10 and 19 percent.
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Cladding form fraud leads to property boss prosecution
A property boss from Merseyside has been sentenced to 15 months in jail, suspended for two years, for fraudulently completing 55 cladding safety forms. Thomas Clarke was instructed by Specialist Façade Inspections (SFI) to complete forms as the business had no one qualified to do so. Mr Clarke advised SFI that his membership of the Royal Institution of Chartered Surveyors was "on hold" but he knew a former colleague who could help. He then created a false email address for his former surveyor colleague and completed the forms, pocketing £6,000 to fund a gambling problem. On sentencing, the court advised Mr Clarke that he was not going to prison simply because the forms were factually accurate. The cladding safety forms were introduced following the Grenfell Tower fire.
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Authors for this week's edition: Jonathan Carrington, Emma Higgins and Lauren Butler
Disclaimer: The information in this publication is for guidance purposes only and does not constitute legal advice. We attempt to ensure that the content is current as at the date of publication, but we do not guarantee that it remains up to date. You should seek legal or other professional advice before acting or relying on any of the content.