Buying house with ‘high’ flooding risk

firsttimesellerldn

I'm hoping for some advice on a house my partner and I are in the process of buying, and in particular views on whether we might face trouble reselling in future. 

I’d posted this on the mortgage forum but haven’t had any responses. 

It's a terraced house in the South-East which suffered some bad river flooding around 20 years ago. The street and house was badly flooded then, but hasn't suffered any flooding since and further flood defenses have been installed. The property doesn't have a basement. It's a period property, ie. built before 2009 so should be eligible for Flood Re cover if necessary. 

The Groundsure report came back with a low risk of river flooding (although the past flooding was identified) and a moderate-high risk of groundwater flooding. The overall flood risk is described as 'high'. 

Our lender Natwest are happy to proceed on the basis that: "Regarding the flood risk we are happy to proceed as long as the clients are aware of the point raised and insurance can be arranged on normal terms." Our solicitor has said: "We will not be able to guarantee that all lenders/buyers will take the same view and this may well be relevant if you come to refinance or sell." We've looked into insurance and it is available. 

We were aware of the previous flooding event when we offered. The house itself is in a popular area where there isn't a huge amount of stock available so in general it's likely to remain desirable. However we are a bit nervous about whether the flood risk is likely to be considered unacceptable by many lenders when we come to remortgage/sell, even those ours are okay with it. Do we have anything to worry about here? Properties on the street do seem to have sold fairly regularly over the years. 

The other scenario we're concerned about is what would happen if the house DID flood again. What's the potential scenario in terms of remortgaging/selling in that case - what approach do lenders tend to take? 

Thanks in advance for any advice

tacpot12

Unfortunately flood events are likely to become more common. I think if it the house did flood again, it would be harder to sell and possibly impossible to get a mortgage on. Is there any evidence that the work done on the flood defences have improved matters? e.g. have there been any really heavy rains storms in the area since the improvements were made?  

DayDreamerandGeneralWaster

The thing is that even if the river defences has been strengthened, there is nothing to be done about ground water. Having experienced it in a workplace, it will come up through the ground, made or not, from the drains too, during significant or prolonged rain events. Bringing the contents of the sewer with it. 

Twenty years isn't that long ago for the river to have flooded. I suspect with what has happened in Europe over the last day or so people will be a lot more wary of this in future.

julicorn

tacpot12 said:

Unfortunately flood events are likely to become more common. 

Yes, just watching the news coming out of Germany at the moment make the risk look all that more real. 

Sistergold

The survey for my house was that it’s was at high risk of flooding. The only reason I went ahead was that it had never flooded before. So for me the fact that it has flooded will put me off. If using your own judgment you do go ahead it should be with the view that you would not mind not being able to sell on the house as already there is history of flooding. 

london21

20 years wasn’t so long ago.

personally I would be sceptical because in the future if looking to sell, buyers will also face this issue and re-selling might be harder. 

goldfinches

I live very near the main channel of the Thames in Oxford and every year there is some flooding in the centre of the city over Jan/Feb time.
Within the city it very much depends on which street your house is on as to whether locals would or wouldn't consider living there and we are all quite aware of the quality of any recent work done to our flood defences etc. Anyone who has lived in the area for more than 5 years has seen the results of various works themselves and can make a fair estimate of the level of risk at any given location or knows someone who can.
If you pop a link to the right move listing for the house you're interested in up on this thread there will be someone on here who can give you that information for the location.

Tiddleshalifax

This for us is always going to be the case, as most of hull is a flood plain!! Houses rarely flag anything below high so for me it would be something id have to accept - as I do here. 

We’ve never flooded but always show as high - as is the next house. 

I guess it’s balancing the risk.

BikingBud

The tragic situation in Germany highlights that another important factor is the underlying ground.

The vast amounts of sand that have been transported with roads, buildings, infrastructure all disappearing indicate how mother nature will take back what she wants. Built on a flood plain on silt you may have significant issues, built on firm rock you may only have to consider water damage! 

Section62

firsttimesellerldn said:

It's a terraced house in the South-East which suffered some bad river flooding around 20 years ago. The street and house was badly flooded then, but hasn't suffered any flooding since and further flood defenses have been installed. The property doesn't have a basement. It's a period property, ie. built before 2009 so should be eligible for Flood Re cover if necessary. 

Did the Environment Agency or local council construct a proper flood alleviation scheme?

If so, this would have been designed to deal with flooding of a certain 'return period' - e.g. 1 in 100 years.  There's no guarantee that there won't be flooding tomorrow - not least because tomorrow there could be a 1 in 1000 storm event.  But the design return period gives an indication of the level of assurance residents have that they won't experience flooding during their ownership.

If you know that historic flooding was caused by rainfall events of (say) 1 in 5, or 1 in 10, and the flood alleviation scheme was designed for 1 in 100, then (if the engineers got the design right) the same types of event won't cause flooding now.

firsttimesellerldn said:

However we are a bit nervous about whether the flood risk is likely to be considered unacceptable by many lenders when we come to remortgage/sell, even those ours are okay with it. Do we have anything to worry about here? Properties on the street do seem to have sold fairly regularly over the years. 

The other scenario we're concerned about is what would happen if the house DID flood again. What's the potential scenario in terms of remortgaging/selling in that case - what approach do lenders tend to take? 

If the predictions about increased flooding are true, then lenders are going to have to become more accepting of flood risk, otherwise they will get a dwindling share of the market.

There are two scenarios if the house did get flooded again.  The first is if the flood alleviation scheme failed to give the level of protection it should have done. In that case it will be difficult to sell/remortgage until something is done to rectify the flood alleviation so it works as it should.  But on the other hand it will be due to a failure by the EA/government to give the level of protection promised so it is likely that compensation would be paid for any losses.

The second scenario is if the event exceeds the designed level of protection - for example if it was a 1 in 200 flood event and the scheme was designed for 1 in 100.  In that case the lenders and insurers should take the rational approach that there is little we can do to protect against the really extreme events, and there are many properties which aren't thought of as being vulnerable to flooding that would get flooded if a 1 in 200 event happens.

In a sense it is similar to the subsidence issue.  A property with protection from a flood alleviation scheme is the equivalent of a property which has been underpinned. Despite having a historic problem, the property now has a known and managed level of risk. Rationally, an underpinned property poses less risk of subsidence than another property which has foundations of an unknown quality.  Unfortunately, buyers, lenders, and insurers are not always rational in their decision making though, and the same applies to flood risk.

DayDreamerandGeneralWaster said:

The thing is that even if the river defences has been strengthened, there is nothing to be done about ground water. Having experienced it in a workplace, it will come up through the ground, made or not, from the drains too, during significant or prolonged rain events. Bringing the contents of the sewer with it. 

That doesn't sound like groundwater flooding.  True groundwater flooding can be mitigated through management of groundwater levels. E.g. by pumping or by drainage.

DayDreamerandGeneralWaster said:

Twenty years isn't that long ago for the river to have flooded. I suspect with what has happened in Europe over the last day or so people will be a lot more wary of this in future.

As above, it depends on whether a proper flood alleviation scheme was constructed and what the design return period is.

I also doubt the tragic events this week will make much difference to people's perceptions of flood risk. We collectively are quite good at forgetting about flood events, even the ones that cause high numbers of deaths.  E.g. if you mention 'Aberfan' most people will have some idea what you are talking about. But mention 'Lynmouth' and you'll get blank looks from most people who don't have a connection to the area, or those who have studied hydrology.

MysteryMe

I'm in the SE and we've massive rainfall recently. Was there any flooding in the area?   The point is surely that steps were taken to mitigate a recurrence and they have been effective.   None of us know the future and no purchase is risk free.  If houses are selling regularly and your lender is willing to lend the money and you can get insurance it sounds like it's a level of risk several parties are willing to take.