Flooding may affect you, even if you are not near water !
- May 1, 2015
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Flooding is a growing risk for British property. The financial risk to homeowners can vary from hundreds to thousands of pounds depending on the flood risk and cost of additional insurance if your property falls within a flood risk area. Landmark reports that that as many as 1 in 6 properties are at risk of flooding and that 10% are not insurable at standard terms. This can impact on a property’s future valuation, mortgage applications and saleability. Insurance companies may also apply large excesses on policies for properties at high risk of flooding.
There is a risk with your lender! If insurance is not available, then the CML (Council of Mortgage Lenders) risk your property being unlikely to be mortgageable.
So is your property subject to a flood risk? The difficulty is that even if at first sight the property is not near water like a stream or river, it can still be at risk of flooding. According to the Pitt Review, 50% of the 2007 floods occurred away from EA floodplains, with 60-70% due to surface water flooding. This is because flooding can include surface water or drains flooding in heavy rain which insurers may load up their insurance premiums for or make it difficult for you to insure. Indeed not all insurers cover this flood risk unless pushed.
Recent research undertaken by Landmark Information Group reveals that “…88% of people consider a professional flood report to be an essential …meaning a greater knowledge of the risks could save you from walking into any unexpected issues when they move home”.
The most common types of flooding are:
• Surface water flooding – occurs when heavy rainfall overwhelms the drainage capacity of an area.
• Sewer flooding – occurs when sewers are overwhelmed by heavy rainfall or when they become blocked.
• Groundwater flooding – occurs when underground water levels rise above surface level. This is most likely to occur in low lying areas underlain by permeable rocks.
• River flooding – occurs when a watercourse cannot cope with the water draining into it from the surrounding land.
• Coastal flooding – results from a combination of high tides, low lying land and, sometimes, stormy conditions.
When purchasing a property please remember that Solicitors are not qualified to give advice on flood risk or interpret technical flood reports. However, the Law Society website provides you with information to help you investigate the terms on which buildings insurance cover, including flood risk, is available, prior to their entering into contractual commitments.
Buyers are strongly encouraged to make sure that insurance can be obtained for the property on acceptable terms before entering into a contract.
So do you have to have a flood search? Flood searches have not YET been made compulsory in all cases, however The College of Estate Management published a report (“Waterproof (www.practicallaw.com/3-518-0155)”) the report says:
“Prudent investors must make full flood risk investigations when acquiring a property that is new to them and where first stage enquiries identify a possible risk…