Recent years have seen a significant rise in the number of high profile floods across the UK, as heavy rainfall continues to be a common occurrence as a result of climate change cases of extreme weather happening all year round[1].
As a result, homebuyers are all too aware – whether from personal experience or from media coverage – of the devastating financial and emotional effects flood damage can have on homes and communities. Harrowing images of destroyed homes on social media and 24-hour news have helped bring fears of flooding to the forefront of many a homebuyer’s mind.
But for those homebuyers who are less aware of the risks, seeking information to avoid potential problems later down the line is crucial. FCI research indicates that one in seven homes sold in 2016 and 2017 had a flood risk associated to them, a figure that rises substantially in urban areas[2]. For example, nearly one in four (23%) homebuyers in London encountered a potential flood risk in 2017, a figure rising further for property bought in Spelthorne near Heathrow (59%) or in Kingston-upon-Hull (50%).
Here, conveyancers have an opportunity to play a vital and meaningful role in equipping clients to make their own informed decisions about flood risk and the necessary precautions they may need to take. The Association of British Insurers has issued a ten-point blueprint urging the UK government to take steps to reduce threats of flood and fire to property, as combined they account for around 50% of all claims in terms of cost[3].
The importance of flood risk awareness cannot be underestimated. When information about school catchment areas and the quality of Wi-Fi are commonplace in property information but flood data is not, we have a significant issue, especially with the average damage of a flood to a UK home between £20,000 and £40,000[4]. Where this is still not a given, conveyancers can help supply the information needed for a home buyer to make the right choice for themselves.
Understanding ‘flood risk’
The key to mitigating buyers’ concerns is being able to communicate what ‘flood risk’ means for a residential property and how it might affect any specific buyer from sale to sale. It’s not enough now to rely on past experience to predict where will flood and when. Just because a particular area has flooded previously, does not mean it will flood again. Similarly, just because an area has never flooded before does not mean it will not flood in the future.
Insurers and risk assessors set flood risk by probability of flooding in a certain time period. If a home is at high risk, it may have a one in ten-year chance of flooding. This means in any given year over a decade, there is a 10% chance there will be a flood. A low risk property might have a one in 500-year risk, so each year there is a 0.05% of flooding.
So, finding out a property includes an environmental risk doesn’t necessarily mean it will happen. Similarly, a house on a street that hasn’t flooded in living memory may still be at risk from floods.
Specialist data is now able to model the flood risk for a particular home, based on continually-updated sources, historic trends, changes to terrain and current flood defences. Using radar and laser technology, data specialists have been able to map the topography of Great Britain within five square meters. This is fed into report systems, and the risk of flooding can be attributed to a specific geographical location. Today’s flood risk assessments are the most accurate we’ve ever been able to produce so property professionals can be sure that the information they are sharing is correct.
Calm jitters with actionable information
A conveyancer who can be upfront with a client and offer a sound assessment of the potential flood risk associated with a property will be a valuable ally. The information is out there – savvy conveyancers who work more closely with environmental search providers will gain the knowledge they need to confidently inform their clients of the flooding hotspots in their town or district.
Admittedly, there is no regulation that calls on conveyancers to offer to support clients with their flood risk issues beyond supply an environmental report. But a recent survey by Economic Insight found that 37% of homebuyers chose their solicitor based on a recommendation from family or friends – offering clients a little extra may prove to be a defining factor in a crowded, competitive market.
Being transparent over risk and having knowledge of the steps one should take, not only establishes trust in the conveyancer/client relationship, but it could also speed up the sale process and result in fewer stumbling blocks down the line if and when the deal is held up by environmental risks. It’s a great opportunity for conveyancers with a little extra knowledge to shine.
For further information on FCI’s report range and how to address flood risk, visit their website here.
[1] https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/584281/uk-climate-change-risk-assess-2017.pdf
[2] http://www.futureclimateinfo.com/News/Details/Homebuyer-urban-flood-risk-report
[3] https://www.abi.org.uk/news/news-articles/2017/11/abi-launches-buildings-blueprint-to-reduce-flood-and-fire-risk/
[4] http://news.bbc.co.uk/1/hi/business/8370408.stm
