More than half of UK property owners expect flood risks to be automatically investigated as part of the conveyancing process.
A survey by property and environmental digital mapping specialists Landmark Information found that, while 80 per cent of homeowners would not buy a property at risk of flooding, just 42 per cent investigated flood risk prior to buying their property.
The assumption among 55 per cent of homeowners is that solicitors will automatically investigate the risk as part of the conveyancing process.
Landmark Information’s director of environmental due diligence David Mole says: “The CML states that, in order to protect both the borrower and the lender, it is a standard requirement of all mortgages for the property to be covered by standard buildings insurance, including flood cover, for the full term of the contract. If insurance is not available, then it is highly likely that a purchaser will not be able to obtain a mortgage.
“It is crucial, therefore, for legal professionals to encourage their clients, whether the purchaser, tenant or the lender, to obtain a desktop flood report for any property they are considering purchasing or taking a lease of. This will alert them to any potential problems, enabling them to research whether insurance cover will be available and discuss flood resistance or resilience measures at a stage when it is still possible to renegotiate the price.”
Mole adds that, with the expiration of the Statement of Principles on 30 June 2013 and the future of flood insurance still highly uncertain, the stakes are high for owners of at risk homes.
The Statement of Principles currently means that the insurance on high-risk homes are partly subsidised through an agreed sum taken from the majority of homes’ premium costs.