An MHCLG spokesperson says: “Our multi-billion-pound interventions will protect leaseholders in the highest-risk buildings from the unaffordable costs of replacing unsafe cladding, and will ensure no leaseholder will ever pay more than £50 a month.
“This will reassure lenders that where cladding removal is needed, costs will not be a barrier or mean that mortgage payments become unmanageable.
“We’re also establishing new regulators to ensure homes are made and kept safer in future – and we continue to work with the industry to make sure these measures help get the housing market back on track.”
Some mortgage brokers have been able to refinance those in affected properties by extending their existing mortgage terms or negotiating a new product with the existing lenders, however transferring to a new mortgage lender has been impossible.
So, how damaging will this debacle be for the mortgage market in the long term?
Steven Truman, director of cladding remediation specialists Cladding Consulting, said: “While there is of course no guarantee that lenders will not look to another safety issue, so far this has not been mentioned and we expect that valuers will be able to value apartments correctly once cladding is removed, enabling lenders to lend.
“We do not believe that internal fire safety works, many of which are in place now, will stop valuers from undertaking their work and valuing properties at current market values."
Just Mortgage Brokers' Shave says: “Undoubtedly the cladding issue has had a major impact on the mortgage market. The new government plans are welcome. But until a full and acceptable solution for all is arrived at, the mortgage market will continue to suffer. Cladding has been an issue for far too long and the losers are the homeowners who are caught up in it all, through no fault of their own.”
Ima Jackson-Obot is deputy features editor of FTAdviser