What is Japanese knotweed?
Japanese knotweed is an invasive plant which is known for its fast and vigorous growth pattern, in and above ground. Its roots can cause structural damage to nearby buildings, foundations and block drains if left untreated. Removal of the plant can also take several years to eradicate.
Why is it a concern for property owners?
Due to the plant’s perennial root and destructive nature it can be quite costly to remove and in some cases, depending on the scale and severity of the knotweed, extensive specialist chemical treatment may be required.
Property owners are obliged to disclose the presence of knotweed under section 7.8 of the Law Society Property Information Form and owners should also confirm whether there is a treatment plan and insurance-backed guarantees in place if the property is known to be affected by the plant.
The presence of the plant could have an impact on the value of the property and its future saleability. Even if the Seller/Landlord/Management Company carries out expensive chemical treatment work the stigma attached to the plant can still deter potential purchasers. Some lenders can outright refuse or withdraw their mortgage offers based on the proximity of the knotweed.
The Lender’s perspective:
Each Mortgage lender adopts their own policies on this issue and take into account a range of factors when considering whether to lend.
Mortgage lenders will normally require evidence of treatment that will eradicate the plant as a condition of lending if knotweed is present on or near the site of a property.
Surveyors are now likely to classify the extent of the problem and categorise the level of threat. Often it will come down to the proximity of the knotweed to the property itself. For example, anything within seven metres of the property might be deemed unacceptable but if further away, might be acceptable.
Lenders may also be able to consider a case where a specialist assessment has been made and remedial work covered by an insurance-backed guarantee has been carried out and confirmed. Companies that treat knotweed will typically cover their work with a guarantee of up to 10 years.
Advice to purchasers:
- Ensure due diligence is carried out during pre-contractual enquiries with the seller’s solicitors by checking the seller’s replies to the Property Information Form.
- If you know or suspect a property or neighbouring land may be affected by Japanese knotweed, we recommend that you obtain professional advice and have it checked by a knotweed specialist or a qualified RICS surveyor as soon as possible to ascertain the extent of the problem and the projected costs for eradicating the knotweed.
- Flag the issue as early as possible with the mortgage broker and lender and investigate whether treatment has been completed and what level of cover is attached. This will help to raise the issue upfront which will help identify a potential lender.
- If knotweed is discovered after you move in, check with your conveyancer whether an indemnity insurance policy will be suitable to provide protection for you and your lender. Such insurance is available to cover the cost of treatment and repair works if knotweed is subsequently discovered at the property, along with any legal expenses incurred should the problem spread to neighbouring land. Premiums typically start from £69 for a £100,000 limit of indemnity.
For more information on Japanese knotweed problems or advice on whether to buy a property affected by Japanese knotweed, please contact our Residential Property team on 0161 475 7676 or email [email protected].