Valuers receive further clarity on External Walling Reviews

As reported in our previous post, December 2019 saw the launch of a new form, the EWS1, (External Wall System 1 form) to assist with the process of valuing properties within residential buildings. The main purpose of the form remains to simplify the process of determining whether works are required to a property in a multi-storey, multi-occupancy residential block, and to what extent any works may impact a property's value.

Background

Lenders are still requiring EWS1 forms for both new mortgages and remortgages. Difficulties with obtaining these forms, coupled with general ambiguity as to when they should be used, created problems with EWS1 initially achieving its purpose. January 2020 ushered a rethink between key stakeholders about the approach to using EWS1, when MHCLG (as it was then) produced a guidance note which increased uncertainty about the scope of buildings requiring a fire risk assessment that might give rise to the need for remedial works that could, in turn, impact on value.  RICS followed up in March 2021 with its own guidance note in a bid to 'unlock ' the market and provide much-needed clarity on scope.  Since the EWS1 form came into force in 2019, there have been several revisions to the content of the form itself and today, 16 March 2022, RICS has published an updated version to the form.

The form has been carefully reviewed by key stakeholders, having listened to market feedback and in consultation with DLUHC.  The revisions have been made with optimum usability in mind. We detail a summary of the key changes to the form below:

Ease

• An electronic option is now available for increased accessibility.
• On page 3, note 3, the signatory options have been split out, for ease of reference.
• On page 4, in notes 4 and 8 there are new references to the recently published BSI PAS 9980, for a streamlined approach to benchmarking. 
• At the top of page 3, where there is reference to ‘Date’, the words ‘of form’ have been added alongside, for easy referencing and clarity.
• On page 4, note 10 the new phrasing of ‘Date of form’ rather than "Date" is also included.

Clarified objectives

The objective has been simplified with the words "for likelihood of proportionate remediation to address fire safety risk,” added to page 1, para 1. This sends a stronger message what the form sets out to address.

On page 1, paragraph 2 of the objective, the words at the end of the paragraph, “Independent advice on the fire risk assessment of the entire building should always be obtained” have been removed, to address concerns about whether the form was seen as mandating potentially unnecessary fire risk assessments.

On page 2 at the wording regarding ‘B2’, the second half of the sentence – “and I have identified to the client organisation the remedial and interim measures required (documented separately),” has been deleted and the remaining wording is consistent with that in B1.

On page 2, the A3 reference to note 7 has been amended to reference, ‘(Notes 7 and 8).’  This is to further highlight BSI PAS 9980 as the new benchmark for defining fire risk and assessment.

On page 2, the B1 reference to ‘(Notes 7 and 8)’ has been amended, removing references to note 7, to now refer only to ‘(Note 8).’ This is to remove scope for any potential ambiguity where B1 references ‘no remedial works are required’ and note 7 refers to ‘any interim measures that may be required.’ The initial references may have caused confusion.

On page 3, note 3, in relation to the signatories, there are extra explanations which tie in with the theme of clarifying objectives and scope:

a. For non-IFE members, the word ‘fully’ prior to ‘qualified’ has been removed.

b. The words ‘and construction products including EWS’ have been inserted between ‘fire safety’ and ‘in the built environment’.

c. The wording ‘For buildings where the finished floor level of the top floor of the building (excluding stories consisting exclusively of plant rooms) is less than 18m above the lowest adjacent ground level, if not qualified as per sub-clauses i. or ii. above, the signatory should be a qualified member of an eligible professional body who has successfully completed the RICS EWS Assessment Training Programme.’ Has been added as a new sub note (iii). This insertion goes a long way to clarify scope. The reference to the new RICS EWS Assessment Training is particularly important as it offers clarity on who is qualified to complete the forms, an issue of previous debate. 

• On page 4 note 4 in addition to the reference to BSI PAS 9980, the wording on investigation, "which allows for the possibility of mitigation as an acceptable investigation outcome’ has been added. This is to reflect that the adoption of mitigating measures could also be the outcome of any investigation, rather than undertaking works to the building.
• On page 4, note 7, in relation to signatory's obligations, there is further clarification on the scope. The additional obligation to “identify any interim measures that may be required” has been added to the end.

Version control and document management

In the footer of each page, the following has been inserted:

a) Document reference (for internal company reference to assist with version control)

b) EWS1 forms issued prior to this date using the previous edition remain valid for a period of five years from the date of signature.

c) Date of the edition (16 March 2022).

• On page 3, underneath ‘Date of form’, the following wording has been inserted: “If this is a revision to you/your firm’s previous form on this building, please state below. Please note, if the form is intended for revision solely due to administrative purposes (for example, a postcode error on the building or a reissue of the form to a different client), the ‘Date of form’ remains valid. If however, the rationale for form revision is attributable to a change in rating due to works having been carried out, the ‘Date of form’ must be amended”. Underneath this text is a new table with two columns, titled ‘Date of form’ and ‘Rating provided (A1, A2, A3 or B1, B2)’ 
• These additions help address any issues surrounding version management and record keeping. To bolster the validity of previous forms, the wording at the end of the page on this latest version further states: “EWS1 forms issued prior to this date using the previous edition remain valid for a period of five years from the date of signature.”

Looking ahead

As set out in our previous article, RPC had early involvement alongside RICS in prioritising suitable draft terms and conditions for those carrying out EWS1 assessments. These latest revisions to the form aim to better protect and assist those using the scheme.  Due to the heightened risk profile of surveyors completing the form itself, there is a newly referenced requisite RICS assessment.  There has also been considerable progress regarding disclaimers to cover professionals, so that using the new EWS1 form is now part of a much revamped and improved system. While we wait for new fire safety assessment regime set out in the amended Regulatory (Fire Safety) Order to come into effect, the EWS1 should prove a welcome interim solution for assessing multi-storey buildings.