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Many of the rules around cladding are retrospective changes, and no doubt developers will put up a legal fight here. However this is far from just cladding thats the issue, cladding represents about a 3 of the costs many leaseholders are facing. It will be interesting to see how the non-cladding aspects play out, as many of these were regulated for such as the need for firebreaks, those are missing across large numbers of Barratt built developments.
1/3 of the costs*
Just for Clarity , can you please know a few of the Barratt built locations of the types of dwelling that this relates to
Make of this what you will, for transparency I comment as some one who does invest his earnings in shares though I had to close most positions last year because of well, this crisis (missed out on the bitcoin rise from 10k to 60 as a result, ironically that would likely have paid the bills faced).
I know if I were you I would want a fuller picture on this and not just the CEO shareholder pitch.
There isn’t a comprehensive list publicly. As an example though waterside park, in east London - for full transparency I own a flat there. This is. brick clad, c. 750 homes, built in 2015 - the site manager won a pride in job award for this, it had its ews rating down graded multiple times, first based on desktop surveys (I understand this is how Barratt manage to pass initial checks to sell their latest builds), then there were intrusive checks - this is where they look in the walls, and all manner of sins are uncovered - this level of check is usually done on builds where there is a new freeholder or managing agent in place.
Just across the park from that development is an older Barratt development, again brick and facing same issues. Their development at the Olympic park also has issues I understand but don’t quote me, and Oceana Boulevard in Southampton also has come up. These are just a few examples, many more have been expressed on Twitter (I don’t have a personal list) over last year. And it’s also believed (I think known, but to avoid a slap on the wrist I’ll go with believed) that suspect materials such as the insulation that is having to be removed from many builds, are still being used in their latest builds going up and on sale now, such as Upton gardens - where we understand existing residents are already struggling to get EWS reports from Barratt, which is raising concerns there. You’ll note that all these builds are very similar in their design, and can be seen applied to many more than mentioned here. In 2021 some leaseholders (not me) attempted to map out the impacted builds to highlight the scale: https://buildingsafetymap.co.uk/ This isn’t specific to Barratt and they have since stopped pushing this, I did enquire last year about Barratt developments listed and was informed they wouldn’t give out specifics but that a large number raised were stated as Barratt built developments. The map is thought to be far from conclusive and just a drop in the ocean. Working in London, almost every person I know here who owns a flat built in the last 20 years is impacted, and that list gets bigger by the week. The sheer fact that Barratts is one of the biggest builders, statistically suggests they are very much impacted. Barratts have not carried out their own assessments yet to my knowledge, which they promised in shareholder announcements - our build has been waiting since April, and they are yet to really look into it.
I hope that helps. Yes I am a bit biased, (hopefully I kept the emotion out) but as an investor I’d want to know.
Just to further clarify, I don’t hold Barratt stock. Just commenting as someone who’s been stung in the markets before (as I’m sure we all have), and I don’t want anyone else to fall victim to Barratt so feel I should give further info on what I know and am going through. I encourage you to do your own research, (plenty of well informed people on Twitter - not often you can say that - on the ins and outs of the buildingsafetycrisis that can no doubt help you further understand the issues at hand, particularly on non cladding issues which are harder to identify) you may feel I am wrong on the scale and that’s fine, and given Barratt make £800m profit a year this may all have little impact on their share price even if they do end up paying out (one for the analysts to determine). But I wanted to give my 2pence worth. Hope it helps.
To clarify further, EWS is an External Wall Survey used by RICS and lenders in the granting of mortgages, It is not a Government scheme and is not underwritten in any way by the Government or legislation. It came about post Grenfell as mortgage lenders sought to safeguard their lending.
Accordingly, whilst some flat owners with poor EWS scores may struggle to sell, it doesn't cost them anything until they try to sell and there is no Govt obligation to do anything about it so it won't affect builders unless they volunteer money for good PR. Shame for the poster and his dreams of profit from property may fall flat but nothing to do with BDEV.
As long as relevant building regs were complied with at time of build, Caveat Emptor just about sums it up
Pooch or anyone who knows about the issues he talks about, can you explain a bit further as I am about to help my daughter get her first place . I thought that a brick external face guaranteed no EWS issues but now I am doubting that assumption.Is it necessary to check details of construction using combustible materials? If so is it Kingspan or something else? Advice would be much appreciated so as to not get into a mess.
A building forum might be a better bet for a good answer. This is for shares!
Why the drop today - any ideas folks?
JEFFERIES CUTS BARRATT DEVELOPMENTS TO 'HOLD' (BUY) - PRICE TARGET 644 (851) PENCE