The Building Safety Act 2022 came into force on the 1st April 2023. It was largely a response to the 2017 Grenfell Tragedy and the resulting cladding scandal. The legislation is intended to change the way buildings are designed, constructed and managed, and to give homeowners and residents more rights, powers and protections.
Though the act is relevant to all new builds now and in the future, there’s special provision for higher risk buildings of seven storeys or more. (Though, confusingly, some parts of the legislation apply to buildings with more than five storeys.)
What does the Building Safety Act mean for those affected by the cladding scandal?
On the whole, the Building Safety Act is positive news for those many thousands of people who live in a building affected by the cladding scandal. The act will protect the majority of leaseholders from any costs associated with fixing historical building safety defects. There are specific rules included for cladding here: if high-rise buildings have been incorrectly built with dangerous cladding, leaseholders should be protected from the astronomical costs of replacing it.
There are a few things to bear in mind here:
- Buildings have to be occupied.
- Buildings have to contain at least two residential units.
- Care homes and hospitals can be included as long as they meet the height requirements.
There’s also the slightly baffling fact that the status of whoever was the leaseholder on the 14th February 2022 will determine whether or not the current leaseholder is entitled to these protections. Whoever was holding the lease on Valentine’s Day 2022 needs to have been living in the property themselves and must not have owned more than two other properties at the time.
Despite the potential for confusion, the overall intention of the act is clearly to help solve the crisis created by the cladding scandal. The legislation should make clear who holds responsibility for replacing cladding on affected buildings to ensure residents are safe.
How does this legislation change the building process?
Developers now need to put together a lot more information during the design and construction of buildings about how they intend to keep the building safe. This information is known as ‘the golden thread’, with the idea that the information stored in this digital record will span the entire lifespan of a building. This golden thread will be passed along during the process and theoretically, should anything go wrong, it will lead right back to the individuals responsible.
And that’s the nub of it really: responsibility. The act brought in a real shift in this respect. Developers and building owners now have to shoulder a lot more responsibility for ensuring their buildings are safe. And when things do go wrong, it puts building owners and landlords in the frame to fix them.
If these rules aren’t followed, there can be serious consequences. There are no limits to the possible fines that can be enforced and, in extreme cases, it could even mean prison time.
What practicalities are we talking here?
We’re fairly early on in the life cycle of the legislation, and there’s still an ongoing process of secondary legislation which will help to clarify exactly how the law will work in practice.
However, the act did establish three new bodies to handle many of the practicalities:
- The Building Safety Regulator (who oversee the safety performance of all buildings, with a particular focus on high-rises. They are now the building control authority for higher risk buildings (HRBs), which means all HRBs need to be registered with them).
- The National Regulator of Construction Products (who regulate construction products and ensure that those that make it to the market are safe).
- The New Homes Ombudsman (who run a compulsory scheme for developers that sets out standards of conducts and quality of work. They also hear complaints from owners of new builds).
The act also brought in the right for the government to introduce a new developer tax and levy to ensure the building industry contributes to the cost of addressing these problems. However, this is still under consultation and development.
Does the act improve things for leaseholders generally?
Yes, it’s certainly supposed to. As well as addressing the cost of replacing cladding, the new legislation also gives leaseholders further rights and protections.
This includes:
- Protecting leaseholders from the cost of other historical building safety defects (along with any associated interim measures).
- Ensuring safety costs for leaseholders are more transparent.
- Giving residents more say in how their buildings are kept safe.
- Giving residents more power to hold owners and management companies to account.
How does the act affect new build properties?
Thanks to the act, those who buy new builds now have more options for recourse if things go wrong. Not only will the development company be required by law to be more accountable for any safety defects, the New Homes Ombudsman are now in place to handle any complaints about developers.
As a little extra bonus, homeowners now have 15 years to claim compensation for sub-standard construction, which is a big increase from the previous deadline of six years.
How is it affecting future sales and purchases?
The Building Safety Act was brought in, in large point, to address the cladding crisis and open up the market for flats in cladding-affected buildings again. Since its introduction, most of the major building firms have, theoretically at least, accepted their responsibility for fixing historical defects.
Unfortunately, for many affected leaseholders the pace of this change is just too slow. According to government information, as of October 2024 only 50% of the 4,834 cladding-affected buildings have started or completed remediation works. The other 50% are still waiting for the conclusion of lengthy negotiations between developers and the government about the funding for necessary works.
This obviously has huge implications for the affected leaseholders, as well as for the conveyancing industry as a whole. If you have any questions about this, please do get in touch and we’ll do our best to answer them.