Expert backs call to protect leaseholders from dangerous cladding costs

A property expert has backed calls by an MP to protect leaseholders from being forced to pay for the costs of replacing dangerous cladding on buildings.

Alan Draper, managing director of Common Ground Estate & Property Management, attended a meeting of an all-party parliamentary group (APPG) on 25 February where Stephen McPartland MP was arguing against changes made in the House of Commons to the Fire Safety Bill.

The previous day, the Commons voted 340 to 225 to remove changes made by peers to the Bill which had sought to prohibit building owners from passing on any remediation costs, such as the replacement of dangerous cladding, to leaseholders and tenants.

But Mr McPartland and fellow MP Royston Smith tabled a separate amendment to protect leaseholders, backed by more than 30 of his Tory colleagues.

As it stands, under the terms of the proposed Bill, a “competent authority” – in this case the fire service – can demand remediation from a freeholder within 21 days.

Consequently, the freeholder can then demand that leaseholders pay for the works and, because it has been directed by a competent authority, no court will stand in the freeholder’s way.

The Bill also unintentionally removes legal protections that would give leaseholders the power to scrutinise costs.

Alan said: “It is grossly unfair that leaseholders are potentially having to pick up the bill for safety work on their buildings which can run into tens of thousands of pounds.

“I agree with Mr McPartland that the Government should table its own amendment to the Bill and remove this highly damaging consequence.”

Alan added that the costs of fire safety remediation works should be covered by proposals presented by the Leasehold Knowledge Partnership (LKP) during the APPG meeting of 10 December 2020.

The LKP proposals are:

• A one per cent new build levy on developers for 10 years, which would raise £425m a year, totalling £4.25bn
• An increased foreign buyer tax of five per cent, bringing in £3.75bn over 10 years
• A 10 per cent levy on ground rents paid to freeholders over 50 years which would raise £1.5bn

Alan said: “For many years builders and developers have cut corners with cheap cladding materials which ultimately led to the Grenfell disaster.

“Why should leaseholders be forced to pay for their incompetence?”