Recently published, the updated versions of the LPE1 (Leasehold Property Enquiries), LPE2 (Consumer Summary) and FME1 (Freehold Management Enquiries) forms go live on 11 January 2022 and include several additions that will benefit property managers and those buying and selling leasehold properties.
One vital addition to the LPE1 form is particularly timely amid the backdrop of the building safety crisis. Indeed, the form now asks whether a fire safety or an external fire wall assessment has been undertaken, and whether there are urgent works required as a result.
Notably, the definition of a low-risk building can be different for lenders and those managing residential properties. Building-safety-related assessments won’t necessarily satisfy all lenders who are, naturally, seeking assurance that their loans can be repaid.
Nonetheless, changes to the LPE1 form should, in theory, allow for greater clarity around building safety, potentially speeding up the selling process and allowing leaseholders to sell on lower-fire-risk properties. However, in practice we have found many managing agents cannot obtain the appropriate PI insurance to be able to answer these new questions, meaning that many are refraining.
The cautious approach stems from the government’s current consolidated advice note, which sets out measures building owners should take to ensure their buildings are safe. At present it is broad, suggesting that anything combustible should be removed from buildings. The government has said it will replace the note, but until this happens, many managing agents will remain understandably cautious when presented with fire safety questions in the LPE1 form.
As a sector, we continually call for a proportional response to fire safety that will prevent another Grenfell tragedy while also shielding those not at serious fire risk from unnecessary costs and delays to the sales of their properties.
Although the additions of the fire safety questions mark positive steps towards fostering this proportionality, the government must also demonstrate it within its new consolidated advice note. Only then can managing agents feel confident enough to provide vital building safety information.
Nigel Glen is chief executive at ARMA