by Mark Johnston
It is probably true to say that there are more types of non-traditional constructions in the UK than in almost any other country in the world.
History has shown that the period between the first and Second World War witnessed the development of various types of housing construction based on pre-cast concrete, timber, steel and occasionally cast iron. Thousands of these homes were built to ease the housing shortage and were only intended as temporary housing,
PRC simply stands for pre-cast reinforced concrete; this is concrete that has steel rods added during the manufacturing process.
These types of properties are no longer built but many are still used to home many families. However, in the early 1980’s defects were discovered in the load bearing columns in many of these properties, which lead to a large number of them being classed as ‘defective’.
In addition to this problem these properties were also found to have poor levels of insulation thus making them more expensive to maintain.
All these problems lead to a decision by the major lending institutes to no longer accept such properties as satisfactory security for mortgages.
Although all was not lost, anyone purchasing one of these properties prior to 1984 qualified for a government grant to assist in a complete repair. Unfortunately this grant is no longer available.
A company named PRC homes Ltd was set up in 1985 to licence repair schemes for housing systems designated as ‘defective’ although this scheme too was discontinued in 1996. So it was therefore then down to the owners to foot the entire bill.
Due to all this the pre-cast reinforced concrete (PRC) mortgage market is very complex, with many factors having to be taken in to consideration.
Most banks and building societies will refuse to lend on pre-cast reinforced concrete properties until they have been repaired under a licensed scheme and certified as such.
Any lenders will need to see evidence of the repairs in the form of a certificate of structural completion; this document has become known as a PRC certificate, in order to consider any kind of mortgage application.
Owners or any potential purchasers of pre-cast reinforced concrete (PRC) properties face major problems linked to mortgagability. The problems generally fall in to 2 categories. The first being unrepaired properties where little or no work has been undertaken since construction or repaired properties were no PRC certificate is available.
Often work has been carried out but no documentation is available to prove this and also many local authorities often undertook repair programs but never issued PRC certificates.
The second is a little more complicated to deal with as many different construction companies and local authorities came up with solutions to the PRC problem, some of these are acceptable to lenders others are not.
The Council of Mortgage Lenders has been working with the Building Research Establishment (BRE) to develop a new certificate standard for such properties. The new standard is intended to meet the concerns of lenders, insurers and other interested parties.
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