Inside Housing – Home – Homes England failed to tell RICS about Help to Buy cladding fix it was supposed to lead

RICS also confirmed that it had so far not received any money through the scheme. Inside Housing is aware of several leaseholders who had paid the fee, which was sold to them as being for the administration done by RICS.
Inside Housing understands that Homes England received the payment from customers after offering to complete the paperwork for customers, with the organisation transferring this money to RICS once the paper work was submitted.
But after it became clear that it could not refer customers to RICS, it refunded all customers that had paid.
Stephen Timms, MP for East Ham, who has constituents who have paid to go down the route, said it was surprising that Homes England made an announcement about a process involving RICS without ever discussing it with the body.
He added: “It’s hard to see how such a fundamental blunder was made.”
This is the latest in a long line of issues that Help to Buy cladding victims have run up against when trying to sell their homes or redeem their Help to Buy loans.
For a period of nearly two years, Homes England would only allow leaseholders to carry out valuations with an “unaffected market value”, meaning surveyors had to pretend dangerous cladding did not exist on buildings. This was changed in August 2021.
Many see the agency’s changing of policies as a means to protect itself from losses caused by cladding victims trying to redeem their loans.
The Help to Buy loan scheme was launched in 2013 to support buyers to get on to the property ladder by providing government-backed loans of 20% of the equity of a property, or 40% in London.
Under the terms of the scheme, the government takes the profit if the value of a property rises, but can lose money if the value drops significantly. This was the case with many blocks that have cladding issues.
This has led to concerns that the government could be on the hook for millions of pounds in losses if homes are sold or loans are redeemed at these much-reduced values.
The one leaseholder Inside Housing spoke to who was able to get through the RICS president process saw the valuation of their cladding-hit flat come in at £332,000, well under the £476,000 they paid for it.
It is estimated that the total amount of equity, the government currently has held up in Help to Buy flats is £5.5bn.
The added difficulties faced by Help to Buy cladding victims when compared with other victims is that they are required to pay interest on their Help to Buy loans in the sixth year of owning their properties, in some cases this is as high a £450.
Without any means to secure a value and move, they are trapped paying this loan which increases by the Retail Price Index plus 1% every year – a significant jump in a time of high inflation.
A spokesperson for Homes England said: “We are extremely sympathetic to the ongoing challenges faced by Help to Buy: Equity Loan customers whose properties have cladding around their homes.
“We continue to work closely with RICS and the Department for Levelling Up, Housing and Communities to find ways to help customers.”



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