House prices and saleability could be hit by aftershock from High-Speed 2 Rail and fracking, warns Landmark Information Group
Following reports that around 350,000 homes affected by the proposed new high speed rail network (HS2) yet receive no compensation, many more homes across the UK face a further potential threat of which solicitors need to be aware and investigate during the conveyancing process: fracking.
Fracking – which is also known as hydraulic fracturing - is caused whilst extracting gas from rock during on-shore energy exploration and production. It results in earth tremors which can affect a property’s structural viability and therefore have a major impact on the value of a home. Small earthquakes have already occurred in the North West, where recent reports indicate that property values could drop by as much as 30%.
Chris Taylor, Product Development Director, Landmark Information Group, said: “Fracking is a very real threat. As fracking will become far more widespread over coming years, it is essential that homeowners and potential homeowners are made aware by their solicitor of any plans for shale gas extraction and the impact that fracking could have on their property.
“With regards to the HS2, at present, local authorities have only identified properties within 200 metres of the proposed rail link as likely to be affected, but this isn’t a true representation. Homes a long way outside this boundary could incur increased noise and environmental nuisance during the construction period and beyond.
“It is not, however, necessarily all bad news for every homeowner living near the HS2. Many of the segments of the rail link will be underground and will, therefore, cause little or no harm at all to the nearby properties; trains will generally not be heard above ground. Many homeowners may even be considering selling their home due to a lack of detailed information. Equally, potential buyers may be discouraged from purchasing a particular home due to concerns that it will affected by HS2.
“Furthermore, homes near stations on the proposed route may in fact benefit and see their property increase in value thanks to the new and vastly improved transport links. This is why it is so important for solicitors to investigate the impact of the HS2 on a particular property in order to obtain the facts, rather than homeowners and potential homeowners assuming the worst and worrying unnecessarily.”
Clive Read, Partner, Real Estate Group of SGH Martineau LLP said: “I am aware of one homeowner whose property is within 200 metres of the proposed route and who saw the value of their home plummet following the announcement of the HS2 project. Sadly, this was not an isolated case - when the proposed HS2 route was announced in 2010/11 the value of many of my clients’ properties fell by up to 30 per cent. Many existing clients are unable to sell their properties at true market values due to the blighting effect of HS2. I have advised a number of clients on applications under the HS2 Exceptional Hardship Scheme and such applications are proving difficult - HS2 Limited has only approved approximately 20 per cent of all claims it has received.”
Chris adds: “There is still a huge amount of uncertainty for property owners who are still waiting to find out if their property will be devalued or bulldozed. While the Exceptional Hardship compensation scheme is available to people living on the proposed route of the London to Birmingham and covers all types of property, it is not available to those over the tunnelled sections of the proposed route or to those affected by fracking.”
To relieve the burden from solicitors, Landmark has launched a brand new service: The Energy and Infrastructure Report. Designed to enable homeowners or potential purchasers to make informed decisions during property transactions, the report identifies whether or not a property is likely to be affected by environmental or noise pollution caused by the proposed link and/or fracking.
Chris concludes: “Unlike the local authorities’ reports we search up to 5km from the property. The report also clarifies if the property is affected by fracking or is near the proposed new route, as well as how the route affects the property, such as by noise pollution. The report shows if the home in question lies directly in the path of the route, and whether the line is in a tunnel, in a cutting, at ground level or on a viaduct.”
Landmark’s Energy and Infrastructure Report is priced at £15 + VAT. For more information, visit www.landmark.co.uk.