Understanding the Building Safety Act 2022: What Buyers Need to Know

The Building Safety Act 2022 (the “Act”) is a landmark piece of legislation in the UK, introduced to address the systemic issues exposed by the Grenfell Tower tragedy in 2017.

The Act aims to improve building safety standards and ensure accountability across the construction and property management sectors. For buyers, whether purchasing a new build or an existing property, understanding the implications of this Act is crucial.

The criteria which must be met for a leaseholder to benefit from the protections created by the Act are as follows:

• The lease must be for a single dwelling within a building of above 11 metres high or at least five storeys
• The lease must be for more than 21 years
• The leaseholder must pay a service charge
• The lease must have begun before 14 February 2022 and as of 14 February 2022, either:

1.     a) the dwelling must have been the leaseholder’s only or main home or
2.     b) the leaseholder did not own more than three dwellings in the UK.

What buyers need to know about the Building Safety Act 2022

1. Check the Building’s Safety Record: Ensure that the building has a clear safety record before purchasing a property, especially in a high-rise building (a building that is 18m or seven storeys). Ask for documentation related to fire safety assessments, cladding materials, and any remediation work carried out.
2. Understand the Developer’s Track Record: Research the developer’s history and compliance with safety standards. The Act holds developers accountable for defects, so choosing a reputable developer is essential.
3. Be Aware of Potential Costs: Buyers should clarify who is responsible for these costs if the building requires safety improvements (e.g., cladding replacement). The Act includes provisions to protect leaseholders from excessive remediation costs, but verifying this before purchasing is essential.
4. Look for the Building Safety Certificate: High-rise buildings must now have a Building Safety Certificate issued by the Building Safety Regulator. This certificate confirms that the building meets the required safety standards.
5. Consider the Long-Term Implications: The Act’s extended limitation period (15 years) means buyers have more time to seek redress for defects. However, it also means that developers and builders may face increased scrutiny, potentially impacting the cost and timeline of new developments.
6. Qualifying Leaseholder Status: Any remediation works required may have a knock-on effect on service charges that may, as a result, increase in the future. For example, if historical defects need remedying, additional work may be required as a result, which means service charges may increase.
7. Purchasing with a Lender: If you are buying with a mortgage, then your legal representative will need to report to the bank about the paperwork received in relation to the Act and ensure the Bank is happy to proceed. You would also need to consider if a future Buyer would be comfortable with the property falling under the provisions of the Act.

What if the Act does not apply now?

It may do so in the future. For example, if your Landlord decides to undertake airspace development or any other development (such as increasing the number of building floors), then the Act would be applicable, provided the leases were granted before 14th February 2022.

Overall, there are plenty of considerations for Buyers in relation to the Act. Furthermore, there may be future changes regarding the Act and leasehold properties as a whole.

If you have any queries about buying a property where you believe the Act applies, please call us on 0207 722 9898 to discuss further.