The difficulty of getting a mortgage for a high-rise property

Getting a mortgage for a flat in a tall building in the UK has become very tricky in recent years.

This is mostly because of problems with the materials used to cover the outside of these buildings - something called cladding. We explain why this matters and what it means for people trying to buy or sell these homes.

What is cladding and why does it matter?

Cladding is the outer layer put on building walls. It helps keep heat in and protects buildings from rain and wind. Some types of cladding can catch fire easily, which naturally is very dangerous.

In 2017, a terrible fire occurred at Grenfell Tower in London resulting in multiple deaths. The fire spread quickly because of the type of cladding on the building. After this tragedy, everyone started looking more closely at what materials were used on tall buildings.

The mortgage problem

Banks and building societies became worried about lending money for flats in high-rise buildings. They fear these homes might:

• be unsafe for people living there,
• cost a lot of money to fix,
• drop in value if they can't be sold easily.

This means many flat owners in tall buildings now find themselves in a difficult situation called ‘mortgage prisoners’. They own homes they cannot sell because buyers can't get mortgages for them.

What happens when you try to get a mortgage now?

If you want to buy a flat in a tall building today, the lender will ask for something called an EWS1 form. This is a special safety certificate that shows the building has been checked and is safe.

Getting this form is:

• Expensive - it can cost thousands of pounds
• Slow - there currently aren't enough experts to do all the checks needed
• Often the responsibility of the building owner, not the flat owner

Without this form, most banks won't give you a mortgage.

Who is affected?

This problem impacts many people:

• People trying to buy flats in high-rise buildings
• First-time buyers who often look at flats as their first step on the property ladder
• Current flat owners who want to sell

Some buildings affected are quite new, and many are in big cities like London, Manchester, and Birmingham.

What's being done to help?

The government has set up funds to help pay for removing dangerous cladding from some buildings. They have also made new rules about building safety.

However, progress has been slow. Many building owners and flat owners are still arguing about who should pay for the work.

What to do if you're affected

If you want to buy a high-rise flat:

• Ask to see the EWS1 form before making an offer
• Check if there are plans to remove any unsafe cladding
• Find out who will pay for any work needed

If you own a flat in a high-rise building:

• Check if your building has an EWS1 certificate
• Talk to your building manager about plans for safety checks
• Join resident groups to share information and support

Looking ahead

New solutions for high-rise building mortgages are already taking shape. With dedicated efforts from industry experts, funding commitments, and thoughtful regulation on the horizon, we're moving toward safer buildings and hopefully a healthier mortgage market.