Buying on possible contaminated land

1sttb

Hi everybody,

I am looking for some advice regarding buying a house in London on a possible contaminated land. It is a Victorian end of terrace property and the environmental search has brought up that the land has a high risk of contamination due to a gas holder and industrial site within 100 metres of the property.

Our solicitor initially gave us three options: pull out, ask the seller to carry further investigations or get indemnity insurance.

The seller has agreed to pay for the indemnity insurance however the surveyor now says that further investigations including soil samples are essential due to the high risk. Furthermore, our mortgage provider has not given us the offer yet as they are waiting for this matter to be resolved. These further investigations can cost thousands of pounds which neither us or the seller are prepared to pay.

The seller purchased the house 6 years ago and remortgaged a couple of years back. Although it was brought to their attention that there is a risk of the ground being contaminated, they did not worry as the area is populated and family orientated, a medical practice is next door and apartments have been built 10 years before she first purchased the house.

The estate agent has just informed us that there is a planning application for the gas holder site to be converted into a self-storage facility by a large company. We think that the council would not have given permission for all this to have happened if the land were contaminated. Or are we completely mistaken?

The surveyor has advised us to walk away. No joke intended but he seems to be on an excessive downer about the property based on proximity to the gas holder.

We love the house and don’t want to lose it. Any advice, please?

AdrianC

It's in London. A 100m radius includes how many properties...?

System

It can (and will) be problematic if you go to sell again - the next person will have these same issues.
The building to be converted is likely to have been forced to protect against contamination with membranes etc or some other kind of mitigation which probably isn't going to have been the case when yours was being built!
It's really down to what the lender will accept if you are happy to live in an area identified as high risk - if they say they need a survey then either you get one or you get a new lender

daveyjp

Have a look at the application for the former gas holder site and see what info has been submitted.

There should be a phase 1 environmental report and there may be a phase 2 ground investigation.

1sttb

Thanks AdrianC. There are around 50 properties I think, mostly split into flats and maisonettes. Our potential property is among the closest, probably within 50 metres, along with the medical practice that is a bit closer!

Pickle_Lily

daveyjp wrote: »

Have a look at the application for the former gas holder site and see what info has been submitted.

There should be a phase 1 environmental report and there may be a phase 2 ground investigation.

Do exactly this. A Phase 1 report isn't likely to be much use as it's purely desk based and will probably still classify the site as a risk - without actual site data (soil and groundwater samples) the environmental consultants will have been conservative in their assumptions (just like your environmental search on the house).

The actual risk will be site specific and dependent on a number of factors such as the local geology, hydrogeology, site uses (current and historical). But the conclusions of the Phase 2 should tell you what the actual risk is.

Thrugelmir

What's the historical nature of the industrial site? New information constantly comes to light. In past eras waste disposal wasn't of primary concern.

paye

An onsite soil investigation report shouldn't set you back anymore then £2k. If you really want the house then take the plunge. If the people already living there hasn't had any problems in the past then it should be ok.

1sttb

Thanks for the replies everybody.

We got a very reasonably priced and un intrusive phase 2 quote and put it to the seller. They have declined to carry it out as they cannot 'un know' the result from a legal point of view.

The application for the gas holder being turned into storage space has not been submitted yet so no joy with their ground checks.

We can understand the sellers point of view but surely if we proceed with a purchase we would be willingly taking on this predicament in the future. And we still don't know what's in the ground (if anything).

Has the surveyor scared us unnecessarily or should we cut our losses and walk away?
Any advice or opinions would be greatly appreciated!

martindow

1sttb wrote: »

The application for the gas holder being turned into storage space has not been submitted yet so no joy with their ground checks.

But this is a different piece of ground to the house you are looking at. Have you searched out the planning paperwork for your development to see what it says about environmental contamination and possible remedial works?

System

martindow wrote: »

But this is a different piece of ground to the house you are looking at. Have you searched out the planning paperwork for your development to see what it says about environmental contamination and possible remedial works?

you'd be very lucky to find the environmental reports for a victorian terrace...