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<p>There is no test of ability to pay for freeholders; the £2 million ‘contribution
condition’ merely determines whether freeholders must meet all remediation costs for
qualifying leaseholders or whether they can seek capped contributions from them. Likewise,
the ‘annual profit condition’ of £10 million is an initial level above which we are
seeking to apply the Responsible Actors’ Scheme to developers; it is not a figure
below which developers are somehow exempt from meeting the cost of remediation.</p><p>Once
a building is remediated, the qualifying status of a lease should not have an impact
on valuation, or mortgage lending. Major mortgage lenders made clear in a statement
in March 2022 they would lend on buildings subject to remediation and guidance from
the Royal Institution of Chartered Surveyors (RICS) published in December 2022 provides
a clear approach on valuing properties impacted by building safety issues.</p>
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