Building Safety Act 2022: a guide for conveyancers

We’re keen to hear your views on the guide and about the BSA 2022 as it develops.

If you want to provide any feedback or suggest any corrections to this guide, email property@lawsociety.org.uk.

Introduction of the BSA 2022

The BSA 2022 is part of the building safety legislation that was introduced in the wake of the 2017 Grenfell Tower disaster.

The government has said it is committed to protecting leaseholders from the burden of remediation costs. It has introduced developer- and government-funded schemes that have significantly reduced the costs for leaseholders.

When the BSA 2022 was first introduced, some firms decided not to take on matters involving affected properties because of the responsibility it appeared to place on them resulting from the novelty, complexity and lack of clarity in the legislation.

Changes have since been made to the legislation and the UK Finance Handbook to help clarify the position. For example:

• the UK Finance Handbook has been amended so the general requirements no longer apply to all leasehold properties, but only those in a 'relevant building', and
• the BSA 2022 has been amended to enable qualifying leases enfranchised after 14 February 2022 to benefit from the leaseholder protections

Further changes to the legislation are expected. There is limited case law at present, and more is expected.

Since the introduction of the BSA 2022, most of the major developers have agreed to rectify historic safety defects.

Many tall buildings will not have any identified historic safety defects, but this does not mean that such defects will not be identified in the future.

As time goes on, the number of properties in scope will decrease as buildings are remediated either by the developer under developer remediation contracts, under the Building Safety Fund or under other schemes.

Who pays to remediate tall buildings affected by fire safety issues?

Developers (developer remediation contracts)

Most major developers and housebuilders have agreed to fix "life-critical fire safety defects" and have entered into developer remediation contracts with government.

Check the government list of developers that have signed the contract

A key step for conveyancers is therefore to establish the status of any remediation contract and the works agreed.

The developer remediation contract requires developers to:

• identify, assess and remediate buildings as soon as reasonably practicable
• report to government on their progress quarterly, and
• take steps to keep residents informed about the progress of the works

Under these contracts, the developers agree to remediate life-critical fire safety works in buildings over 11 metres and more than five storeys.

Developer remediation contracts are backed in legislation by the Responsible Actors Scheme. This provides serious penalties for the developers if they do not comply.

As most major developers have entered into developer remediation contracts, most affected relevant buildings should be remediated in respect of "life-critical fire safety defects" without recourse to long leaseholders.

Long leaseholders

Long leaseholders are usually required to pay a contribution towards the cost of major works through a system of service charges, as set out in their lease.

For properties affected by historic safety defects, the BSA 2022 provides protections to limit the degree to which long leaseholders are liable to pay for fire safety remediation work.

The protections cover defects not yet identified, which may be historic and not yet discovered.

Unlike typical long leasehold arrangements, under the BSA 2022 leaseholders should not be called on first to pay for historic safety defects and defects discovered in the future.

This protection covers, as the government guidance says, "any defect caused during the construction or refurbishment of a building in the past 30 years that causes a risk to people’s safety from the spread of fire, or the collapse of some or all, of the building".

The government's aim is that the primary liability will fall on the developers, landlords and freeholders of the affected blocks, rather than long leaseholders.

The liabilities fall to different extents, on different parties for different types of work.

Cladding-related remediation costs

The BSA 2022 provides leaseholders with statutory protection from the costs of cladding remediation.

‘Cladding remediation’ means the removal or the replacement of any part of a cladding system that forms the outer wall of an external wall system and is unsafe (see Schedule 8 to the BSA 2022).

There are different cladding schemes for properties in buildings that are:

• over 18 metres or more than seven storeys containing at least two flats (‘higher risk’ buildings), and
• between 11 metres and 18 metres or are over five storeys containing at least two flats

Note: for buildings over 18 metres that are at least seven storeys and contain at least two residential units, a Building Safety Register has been established. This will hold information about these ‘higher-risk buildings and the building assessment certificates they need to have.

Search the register for 'higher risk' buildings

The BSA 2022 and the Fire Safety (England) Regulations 2022 require accountable persons and responsible persons to electronically share building information with regulators.

When available, the building assessment certificate will be displayed in the relevant building.

Building owners will not be able to demand the costs of remediating or removing cladding, from qualifying leaseholders (those who lived in their property or who did not own more than three properties in the UK on 14 February 2022) in relevant buildings (those over 11 metres or more than five storeys).

Non-qualifying leaseholders will be fully protected where their building owner is the developer or is associated with the developer (see section 121 of the BSA 2022 on associated persons).

Where the defect is in relation to unsafe cladding, a landlord (or associated person) is responsible for the works if they were the developer or undertook or commissioned the works relating to the defect.

In these circumstances, no service charge is payable for these works under the leases, whether they are qualifying or non-qualifying.

Government schemes are also in place to fund cladding-related remediation where developers cannot, meaning that non-qualifying leaseholders are protected from cladding system costs.

The Cladding Safety Scheme (CSS) will meet the costs of addressing life-critical fire safety works for buildings between over 11 metres tall (11 to 18 metres in London) where the developer cannot be traced or held responsible for remediation work, for example, where they’ve gone out of business.

The application to the CSS for funding has to be made by the ‘responsible entity’ or their representative.

The Greater London Authority operates the Building Safety Fund for buildings over 18 metres in height in the Greater London area.

The leaseholder does not have to prove that the landlord is the relevant landlord.

Instead, the landlord has to prove they are not the relevant landlord by producing a certificate in a prescribed form to say that are not the relevant landlord (see below on certificates).

Non-cladding-related remediation costs

The BSA 2022 provides for what has been referred to as a ‘cascade’ of responsibility for establishing who is responsible for meeting the cost of non-cladding remediation work on blocks over 11 metres with at least five storeys.

Broadly in the first instance, developers, manufacturers and freeholders are responsible for the costs of remediation where they meet specific criteria.

At the end of the cascade (after developers, manufacturers and freeholders), long leaseholders who do not otherwise qualify for additional leaseholder protections may be required to contribute.

Qualifying leaseholders

For qualifying leaseholders, there will be caps on leaseholder contributions unless the value of the property is less than £175,000 in England outside Greater London or less than £350,000 in Greater London, in which case no charge can be made for non-cladding defects.

Qualifying leaseholders have protections from the costs associated with non-cladding defects, including interim measures like fire patrols, and waking watches.

The developer/freeholder cannot increase the remediation costs falling within the service charge to replace money that qualifying leaseholders are protected from paying.

No service charge is payable under a qualifying lease either for the remedial works or for legal or professional services relating to liability or potential liability of any person, incurred because of a ‘relevant defect’.

There are additional limits on the service charges that can be levied on those who have a qualifying lease.

Non-qualifying leaseholders

Non-qualifying leaseholders are only protected from the costs of historical safety remediation if their building owner is – or is associated with – the developer who is responsible for that defect.

Any historical safety remediation costs where the developer who built or refurbished the building is, or is associated with, the building owner cannot be passed on.

Where this is not the case, non-qualifying leaseholders will be liable for remediation costs in accordance with the service charge provisions in their lease.

No service charge is payable for a defect which a landlord, or an associate of the landlord, is responsible for remediating.

Service charges for all works that do not fall into the protected categories will remain to be paid by leaseholders. These costs could be substantial.

Any programme of major building works on a large building may give rise to larger than usual service charges and buyers need to be alerted to this.

They will still have the benefit of the general provisions in the Landlord and Tenant Act 1985, whereby they have the right to take action against the landlord if they think the service charges are not reasonable.

Leaseholder protections

The ‘leaseholder protections’ are relevant where there is no developer remediation contract and non-cladding related remediation is not being covered elsewhere.

The ‘remediation costs under qualifying leases’ (Schedule 8 of the BSA 2022) provisions are designed to significantly reduce remediation costs for leaseholders, typically for cases where other schemes do not apply, at all or in part.

If no other scheme is in operation, you can direct your client to the government guidance on building safety leaseholder protections and how to buy, how to sell or how to lease.

Key points are set out below, with links to more detailed government guidance provided at the end of the guide.

How leaseholders qualify

Whether a leaseholder qualifies for protection from the costs of remediation depends on whether the property:

• is in a ‘relevant building’
• is demised by a ‘qualifying lease’ granted before 14 February 2022 (‘the qualifying time’), and
• has ‘relevant defects’ (which relate to a safety risk arising from the likely spread of fire or the prevention of a collapse of the building) in a building that was either constructed between 28 June 1992 and 27 June 2022 or if the defect was created by works carried out during that time

To facilitate the operation of the leaseholder protections, the legislation requires certain information to be provided by a leaseholder to their landlord and, if they are planning to pass on these costs, by a landlord to their leaseholder, using a system of certification.

Leaseholder and landlord certificates

There are two types of certificates, with prescribed forms for each in the legislation.

Leaseholder deed of certificate

The leaseholder deed of certificate demonstrates that the lease is a qualifying lease enabling the current leaseholder and future leaseholders to have the benefit of the leaseholder protections.

A leaseholder must evidence that they have a qualifying lease by setting out information about value and ownership of the property on 14 February 2022 in a leasehold deed of certificate.

They must do this if required by the landlord but can prepare one at any time.

The leaseholder will normally be required to prepare one to provide to a prospective buyer with evidence that they own a qualifying lease or evidence that a lease is non-qualifying.

You will see from the seller's responses to the questions about certificates on the TA7 form whether there is a leaseholder deed of certificate.

If you are acting for the seller and there is no leaseholder deed of certificate, you should try and establish if they are entitled to prepare one and, if they appear to be eligible, suggest to the leaseholder that they create one and offer assistance.

If you are acting for a buyer, you should look to establish whether a leaseholder deed of certificate exists and obtain a copy before exchange of contracts.

It is important to identify whether the seller has been asked to provide a leaseholder deed of certificate by the landlord or whether the seller has provided a leaseholder deed of certificate voluntarily and, if they did this, when they provided it.

If there is no leaseholder deed of certificate, it may mean the seller or their predecessor was not entitled to the protections at the qualifying time (14 February 2022) and that position cannot be remedied: the property will never benefit from the protections.

The seller should be asked to produce a leaseholder deed of certificate if there is one or, if there isn't one, to create one.

A leaseholder deed of certificate can be produced at any time. It does not have to be because of a sale or at the request of the landlord. 

This needs to contain specified information and be created as a deed, signed and witnessed.

Leases of residential properties are presumed to be "qualifying", until this is countered by the leaseholder either:

• providing a leaseholder deed of certificate confirming that none of the relevant conditions were met, or
• failing to respond to a request from the landlord for the provision of a leaseholder deed of certificate

Landlord's certificate

The landlord's certificate is used by landlords to pass on historical safety remediation costs to a leaseholder.

It confirms whether the landlord met the contribution condition as at the qualifying date (14 February 2022).

These certificates provide important evidence about the 'relevant landlord' (the landlord on 14 February 2022), which helps to confirm who is responsible for the costs of remediation work.

They also provide details of any remediation works that have already been carried out.

The landlord must provide this certificate where it demands service charges for remediation costs within four weeks of:

• being notified by a leaseholder that their leasehold interest is to be sold (or within four weeks of a leaseholder requesting it), or
• becoming aware of a new leasehold deed of certificate in relation to a lease of a dwelling in the building if the deed of certificate sets out information that was not in a previous landlord's certificate

Provided the leaseholder has completed the leaseholder deed of certificate, the lack of provision of a landlord's certificate within four weeks should mean the leaseholder qualifies for the leaseholder protections by default, but only for those historic defects that have already been discovered.

If new defects are discovered, the landlord could still issue a landlord's certificate to recover the cost of these from the leaseholder.

Section 6(1)(c) of the Building Safety (Leaseholder Protections) (England) Regulations 2022 requires a landlord's certificate to be issued:

"within four weeks of becoming aware (either themselves or by notification from another person) of a relevant defect not covered by a previous landlord's certificate;" (emphasis added)

A further landlord's certificate is needed every time a new defect is brought to the current landlord's attention if the landlord wants to recover the costs of remediating through service charges.

In these circumstances, it is therefore a benefit to a buyer if there is no landlord's certificate: the landlord is deemed to meet the contribution condition and no service charge is payable.

The buyer should be warned that there is still the possibility the landlord could produce a landlord's certificate.

You may want to retain full notes of all the efforts made to establish issues such as effective service of leaseholder requests and efforts to establish the existence of any landlord's certificate and the resulting communications with your client.

The information that the landlord's certificate must contain is set out in the legislation, supported by guidance from the government.

The landlord will, through the certificate, demonstrate, among other things:

• whether they were, or were associated with, the developer of the building on 14 February 2022, and
• whether they met the contribution condition on 14 February 2022

The contribution condition is whether the landlord group's net worth as at 14 February 2022 was more than £2 million for each relevant building. If it was, no service charge is payable.

The landlord must provide a copy of the landlord certificate and leaseholder deed of certificate to any right to manage (RTM) entity, the resident's management company (RMC) and any named manager within one week of completion or receipt.

If it fails to do so, costs cannot be passed on to leaseholders.

The landlord's certificate must be accompanied by additional documentation, including company accounts for the relevant landlord, in accordance with regulation 4 of the Building Safety (Leaseholder Protections) (England) Regulations 2022 (as amended).

Leaseholders excluded from the protections

Some leaseholders may be excluded from protection from cladding remediation costs, for example:

• those in leaseholder-owned blocks
• those in affected buildings under 11 metres in height

General criteria for working on BSA 2022 matters

We set out below some steps firms can consider when deciding whether to take on work involving the BSA 2022.

It is a matter for individual firms to determine whether they will act in transactions involving affected properties.

Review processes and precedents

Develop policies and set criteria for accepting instructions in these matters if they are not already in place.

Your professional indemnity insurance (PII) insurers may look to you to do this.

Consider:

• whether and in what circumstances will your firm act?
• once this is established, who will make decisions and what criteria will be used to determine this in each instance?
• whether you need to revise retainer terms and conditions, engagement letters and reports on title to include the necessary disclaimers and warnings?
• will you place any limits on the number of cases or a maximum percentage of leasehold sales and purchases taken on in a year?
• do you want to assign this work to a specific specialist solicitor, conveyancer or team within the firm?
• if instructions are accepted, will there be a fee premium or will you require a separate set of instructions for more detailed aspects of the work?

Engagement letters and retainers

Review your engagement letters for leasehold conveyancing and include information about the BSA 2022-related issues.

You may want to include links to the helpful government consumer-facing material (links provided at the end of this guide).

You can reserve the right to cease to act in circumstances where you cannot comply with lender requirements.

If you will not be able to act, you should advise the buyer, the lender and the seller's conveyancer as soon as possible.

Consider whether you want to limit the scope of your retainer as to what you will and will not advise on. Examples might include:

• the height of buildings (especially where the building is close to meeting the various height qualifications)
• advising on whether buildings are in scope, or
• the more complex parts of the contents of certificates

If you do limit the scope of your retainer, you need to explain clearly to your clients why you cannot advise and what this means for them.

Consider preparing a disclaimer to be set out at the beginning of the retainer explaining that you can only check certain aspects of, but not verify the contents of, certificates such as the leaseholder deed of certificate and the landlord's certificate.

Any disclaimer could also be included in your firm's terms of business.

Review general advice to clients and your conveyancing precedents

Develop the advice your firm will give to seller, buyer and lender clients. Record to clients that solicitors/conveyancers:

• are not able to advise in relation to the physical structure of buildings or fire safety issues (on which specialist building survey advice should be obtained)
• can pass on information they have been given by the seller's solicitors and the landlord/managing agents of the building but cannot warrant or guarantee this information
• will carry out all necessary searches and check any relevant registers, but that the information obtained may not be definitive
• cannot measure the height of buildings and therefore cannot advise definitively on the specific provisions in the BSA 2022 that apply to a property
• cannot necessarily establish for the landlord's certificate or leaseholder deed of certificate who owned a particular building or how many they owned at a particular date
• cannot verify information about landlord's finances and some of the other information in landlord certificates

Professional indemnity insurance

You should be prepared to answer questions that may be raised by your professional indemnity brokers or insurers.

Some insurance brokers have indicated they are willing to provide cover with insurers, subject to certain assurances being put in place.

You may want to discuss the issue with your broker or insurer.

As the operation of the BSA 2022 becomes more established over time, PII requirements are likely to evolve.

Establishing if a building is in scope

Searches and registers

There is no search you can carry out that will provide definitive information as to whether a property is in scope, is a higher risk building, has a developer's remediation contract in place, has the benefit of the Building Safety Fund or has the benefit of the leaseholder protections.

Search the register for higher risk buildings – those over 18 metres or seven storeys or more. If you know the postcode of the property, you can use this to search.

There is no register you can search to obtain the same information for buildings over 11 metres or five storeys and under 18 metres or seven storeys.

As set out above, the government provides a list of developers that have signed the developer remediation contract.

Your local authority search CON29 may provide some information, including about any building safety enforcement action undertaken by local authorities in England and, from April 2024, Wales.

You will not be able to provide assurances about all the information received, so you should not make representations that you cannot stand behind.

You can confirm what searches have revealed.

It is not your role to categorically state the height of the building or whether the leaseholder protections apply.

From the seller, managing agents and freeholders (TA7 and LPE1)

The TA7 and LPE1 forms may provide information about:

• the height of the building
• whether the building is a 'relevant building'
• the status of any works (if needed, in progress or completed)
• the existence of a developer's remediation contract
• the existence of landlord's certificates and leaseholder's deeds of certificates

You should ask your client whether they are aware of the status of the building and can confirm this to you in writing.

Conveyancers should ask the seller to complete TA7 leasehold enquiries. This should elicit copies of any landlord's certificate and leaseholder's deeds of certificate.

As the TA7 can be completed by the seller at an early stage with no costs having to be paid to a third party, it could be useful to use this information as an early marker of the position.

It is recommended that the seller is sent a TA7 to complete as early as possible, even before there is any prospective buyer.

The LPE1 form should be submitted to the landlord or managing agent to obtain a more definitive position. Ideally, this should also happen at an early stage.

If there is no developer, those completing the LPE1 should be able to provide evidence that the building has remediation funding through the Building Safety Fund or Cladding Safety Scheme.

If the building is eligible for funding, the freeholder or RTM company should have updated leaseholders as to the position and the seller should provide this information in the TA7.

Information from estate agents

The National Trading Standards Estate and Letting Agency Team (NTSELAT) released its requirements for the information estate agents should use in marketing properties and 'information for sellers' on 30 November 2023.

The NTSELAT guidance requires that:

• any issues known about the safety or structure of the building (such as unsafe cladding), and the costs of remediation or other costs, are to be provided in the marketing material compiled to sell the property
• simple language is used by the estate agents so the scale of any remediation or development work is made clear, even though the issues can be complex
• if prospective buyers may need to vacate the property to allow remediation or building work to be carried out, the duration and scope of this should be disclosed
• the actual or expected cost of remediation or mitigation for any relevant building safety issue should be disclosed where the liability for payment falls to the prospective buyer

NTSELAT also recommends to estate agents that where building safety work has already been completed (for example, remediation to unsafe cladding), the agents obtain a copy of the completion certificate.

Information from lenders, surveyors and valuers

There are different types of reports that may provide useful information.

The main means of assessing buildings for fire risk include:

• fire risk appraisal of external walls (FRAEW) – this is an assessment process designed to evaluate the fire safety performance of external walls
• fire risk assessment (FRA) – this is a review of a building to assess its fire risks. Under the Fire Safety Act 2021, all multi-occupied buildings of any height in England and Wales must have an FRA taking account of the external walls to enable effective risk management of the building to be put in place
• external wall system fire review certificate (EWS1) – this was created to assist in mortgage valuations for individual leasehold properties and is not a legal requirement. In December 2022, six major lenders (Barclays, HSBC, Lloyds Banking Group, Nationwide Building Society, NatWest and Santander) signed a statement on cladding that confirm that they will consider mortgage applications on impacted buildings before they have been remediated, where they are in a developer or government remediation scheme, or covered by the leaseholder protection as evidenced by a leaseholder deed of certificate. This has reduced the need for EWS1s to help satisfy mortgage applications. In December 2023, three more lenders (Skipton Building Society, TSB and Virgin Money) supported the statement. This statement has effectively been replaced by the requirements of the individual lenders in Part 2 of the UK Finance Handbook

Buyers can ask their own surveyors to advise them on the contents of FRAs or FRAEWs that have already been carried out.

Not all surveyors will be able or prepared to provide this advice.

Valuers will usually be instructed by the lender. They will not ordinarily provide comment on building safety status.

The valuer may provide a copy of the EWS1 report if this is available.

Valuers may provide professional reports that have been provided to them, if they have the required permissions. They may also request that additional reports are prepared.

As usual, you must report to the lender immediately if you are provided with information that conflicts with any assumptions made in the valuation, in the unlikely event it is provided to you.

Paragraph 4.4 of the UK Finance Handbook recommends that you advise the borrower:

• not to rely on the valuer's report in deciding whether to buy, and
• that they should only make their decision to purchase based on a fuller inspection that they commission for their own use

Advising sellers

The seller may have some knowledge about the status of the building their property is in.

You should ask the seller to reply to TA7 leasehold enquiries. This ought to reveal any landlord's certificate and/or leaseholder deed of certificate.

You should inform the seller that they could be liable in damages for misrepresentation if they say something that is not entirely correct.

You should also ask the questions raised in paragraph 5.14.17 of the UK Finance Lender's Handbook and make a note of their responses.

If there is no leaseholder deed of certificate, you should encourage the leaseholder client to serve leaseholder deeds of certificate if they qualify.

You may want to provide the leaseholder with a link to the government guidance for leaseholders on completing the leasehold deed of certificate.

If you do assist the seller to prepare a leaseholder deed of certificate, you should:

• make a contemporaneous record of your advice to the client and any exchanges with the buyer's solicitor/conveyancer, and
• make it clear to the seller and the buyer's solicitor/conveyancer that you are not guaranteeing the content of any declaration in relation to the number of properties owned by the seller as at 14 February 2022 – this is the responsibility of the seller

Leaseholders (qualifying or non-qualifying) can ask for a landlord's certificate by informing the landlord of their intention to sell.

If they do not receive a landlord's certificate within four weeks of the request, then identified historic remediation costs cannot be passed on from landlord to long leaseholder.

If a buyer's solicitor asks for a leaseholder deed of certificate (to establish qualifying status) and your seller client is not able to produce one, this may result in some renegotiation of the sale terms or the buyer may withdraw from the purchase.

This may not be the case if developer remediation contracts are in place, or if works are to be funded in some other way (such as through the Cladding Safety Scheme or Building Safety Fund).

You should try to establish whether the seller has been notified by the landlord that they need to complete a deed of certificate, either because they are selling their property or because there is a relevant defect in the building.

If the seller does not complete a deed of certificate and submit it to the landlord, the seller and any buyer from them will not benefit from the protections for qualifying leases.

You may want to retain full notes of all the efforts made to establish whether the seller was notified by the landlord of the need to complete a deed of certificate and the resulting communications with your client.

Advising buyers and lenders

Buyers

If the property has already been remediated or does not need remediation, the transaction will proceed as usual.

But if it is a relevant building or a higher risk building, evidence in the form of certificates and supporting documentation is likely to still be required to satisfy lenders and/or future buyers.

You should ask your buyer client whether they are aware of the status of the building and ask them to confirm this to you in writing.

You should ask the buyer whether they are aware of the implications of buying a property with un-remediated historic safety issues and record their response.

You should explain at the outset:

• the potential for the conveyancing process to take longer if certificates or documents required by the lender have not been received from the seller’s solicitor/conveyancer (for example, if you need to wait to see if the seller receives a response from the landlord within four weeks of service of a leaseholder deed of certificate)
• that you will need to be able to comply with their lender’s requirements and that if you are unable to do this, you may no longer be able to act and they would need to seek alternate representation
• the status of the lease they are buying (qualifying or non-qualifying) will be as at 14 February 2022, that this will not change and what this will mean for them (for example, if they are buying a lease that is non-qualifying, they may find it difficult to sell)
• that they will incur service charges for the costs of items not covered by the protective schemes or protective legislation and that these could be substantial
• that they may find it difficult in the future to sell a property with un-remediated historic safety issues, particularly if there are delays to the works, should they need to sell before any remediation is completed
• if you’ve been informed that the building is a higher risk building, you should advise as to the new terms implied in leases and the recovery of safety-related costs provisions (section 112 of the BSA 2022).

If the buyer is purchasing a property from a leaseholder holding a qualifying lease, you should ask for, and receive a copy of the leaseholder deed of certificate.

Unless you are acting for a cash buyer or a buyer who has confirmed in writing that they are fully aware that the lease of the property is non-qualifying and what that means for them, you will need to see a leaseholder deed of certificate.

Neither you nor the seller’s solicitor/conveyancer can guarantee the contents, but there are certain checks you may be able to carry out, such as checking that:

• the correct number of boxes have been ticked
• the name and address are correct and that the documents listed as attached (if applicable) are attached, and
• it appears to be correctly signed and dated, and
• the witness information is completed

You should review the requirements of the buyer's lender in Part 1 and 2 of the UK Finance Lenders Handbook when you receive instructions from the lender to establish that you can comply.

While clients can be informed about any assurances from sellers, estate agents, landlords or managing agents, it is important to clarify and emphasise that you are not providing the assurances yourself unless you are confident in doing so.

Your report on title to the buyer should make this point.

What buyers need to consider

If the property the buyer wishes to buy needs remediation, you should ask them if they are aware of what this might mean once they move into the property and record their response.

In the earliest communications with the buyer, you may want to set out some of the matters they should consider in a purchase of this nature. These might include:

• safety issues
• general service charges
• how long any works are estimated to take
• when they will start
• whether they will have to move out whilst the works take place and, if so, how that would be funded

Lender's requirements: UK Finance Handbook

The UK Finance Handbook requirements have been amended so the Part 1 provisions on building safety (paragraph 5.14.17) no longer apply to all leasehold properties but only those situated within “a relevant building.”

Some lenders have amended their Part 2s so that they are not requiring you to verify the status of certificates.

As the provisions in the UK Finance Handbook may be subject to change, you should check Part 1 and Part 2 regularly throughout the transaction. This includes:

• on receipt of the instructions accompanying the mortgage offer
• before exchange
• before completing the certificate of title, and
• before completion

The main obligation is set out in Part 1 of the UK Finance Handbook, 5.14.17, which states that:

“you must request the following information from the seller’s conveyancer about the building in which the flat is situated:

• Confirmation as to whether the building has been or will be remediated under the Building Safety Act 2022. 
• Copies of any Landlord’s Certificates, signed by the Landlord in the form set out in the Building Safety (Leaseholder Protections) (England) Regulations 2022.
• Copies of any executed Leaseholder Deed of Certificate (in the form set out in the Building Safety (Leaseholder Protections) (England) Regulations 2022) and confirmation that they have been submitted by the relevant leaseholder to the landlord…”

However, the sellers’ conveyancer may not be able to provide confirmation as to whether the building will be remediated under the BSA 2022 or that executed leaseholder deeds of certificate have been submitted by the relevant leaseholder to the landlord.

The deed must be sent as a hard copy, so you should check if there is proof of postage/service/delivery.

You will need to consider whether you can confirm to the lender that:

the building will be remediated or whether the only information you can provide is the evidence you have seen as the best indication that the building will be remediated

the leaseholder deed of certificate has been submitted by the relevant leaseholder to the landlord or whether you can only provide what you have been told by the seller’s solicitors/conveyancers

You may be asked for other confirmations from the lender. If the lender has requirements you are not able to satisfy, you may be able to engage with the lender to see if they will adjust these.

Having a dialogue with the lender could improve the chance of the transaction progressing successfully; lenders may be able to assist and discussions at an early stage could help identify pragmatic solutions to issues you encounter.

Ceasing to act is a last resort.

Certificates of title

Members have told us that some lenders are accepting qualified certificates of title, in specific cases, where the qualifications relate to building safety issues.

You should not rely on this being the case and should check the position with the buyer/borrower’s specific lender in advance of submitting a certificate of title and certainly before exchange of contracts.

Lender/valuer information

As most valuers will act for the lender, and not act for the borrower/buyer, you are unlikely to be provided with a lender’s valuation.

RICS (Royal Institution of Chartered Surveyors) have guidance on the valuation approach for properties in residential buildings with cladding.

As with general valuation guidance, this includes assumptions that valuers can make.

If you do see valuation reports, you should notify the lender as soon as possible if any of the information you have conflicts with information in the valuation.

Leaseholder-owned buildings

Although leaseholder-owned buildings are excluded from the ‘leaseholder protections,’ they may be covered by a developer remediation contract.

The government’s guidance for leaseholders outlines the obligations the leaseholder protections place on building owners, right-to-manage companies, resident management companies and named managers. This applies to leaseholders who own the building and the managers of the building.

For leaseholder-owned buildings that fall into the higher risk category (those over 18 metres or five storeys containing at least two residential units), the leaseholders will need to comply with the requirements for the accountable person and the principal accountable person.

The new terms implied in leases of higher risk buildings for the recovery of safety-related costs provisions, set out in section 112 of the BSA 2022, also apply to higher risk buildings that are owned by leaseholders.

The position in Wales

The Welsh government has confirmed a route to remediation for all high-rise residential buildings affected by fire safety issues.

The commitment applies to all residential buildings of 11 metres or over in height and is not restricted to buildings with cladding.

For residential buildings of 11 metres and over, there is a route for every building to achieve remediation of fire safety issues which relate to the construction of the building. The costs for these works will not be passed to the leaseholders.

This applies whether the building is the responsibility of social sector partners, developers, or orphan buildings where there is no developer available to undertake remediation works.

From April 2024, the Welsh government will restrict the oversight of new high-risk buildings to local authority building control. This should mean that local authority search (Con29) results should include information about building control in Wales.

Qualifying leaseholders

In Wales, there are no ‘qualifying’ or ‘non-qualifying’ leaseholders. All leaseholders are in scope for this support. 

Therefore, there is no requirement for leaseholders to provide a certificate confirming they or their property qualify for support.

Buildings covered by the developer's contract

Developers have signed a contract that commits them to address fire safety issues which relate to the construction of the building.

These developers have plans in place to undertake works at no cost to the leaseholder.

Orphan buildings and buildings not covered by the developer's contract

Orphan buildings (those which have no identified developer, the developer has ceased trading, or the building is over 30 years old) will be supported through the Welsh Building Safety Fund.

For buildings constructed by developers who have not signed the developer’s contract, the Welsh government will support those companies who cannot cover the full costs of remediation through the Welsh Building Safety Fund.

Annexes

If you want to provide any feedback or suggest any corrections to this guide, email property@lawsociety.org.uk.

Government guidance and materials

Building safety leasehold protections: guidance for leaseholders

• Provides leaseholders with a plain English explanation of the implications of the leaseholder protections
• These protections came into force on 28 June 2022, with new financial protections for leaseholders in buildings of 11 metres or at least five storeys with historic safety defects

Qualifying date, qualifying lease and extent

• Clarifies the extent (or location) to which the leaseholder protections apply
• Explains what is meant by 'qualifying date' and 'qualifying lease'

Leaseholder deed of certificate template

• Sets out the information needed to complete the leaseholder deed of certificate and landlord's certificate
• Provides downloadable and editable versions of both documents
• See also the government FAQs about the leaseholder deed of certificate

What are my building owner's legal obligations?

• Outlines the obligations that the leaseholder protections place on building owners, RTM companies, resident management companies and named managers

Leasehold Protections Checker

• Tool for leaseholders in England to check whether they will have to pay to replace cladding or to fix other safety problems with your building

Criteria for determining whether a building is a higher-risk building during the occupation phase of the new higher-risk regime

• Sets out how you can establish if a building is a higher risk building

Developer remediation contracts

• The government asked developers to enter into remediation contracts; by 7 December 2023, 54 developers had done so
• Includes a list of these developers

Building safety remediation data

• Monthly data on buildings in the Building Safety Fund, Cladding Safety Scheme, developer remediation contract and reports made by registered providers of social housing, as well as high-rise buildings with aluminium composite material (ACM) cladding systems