Coastal erosion: Risk should be material information
Conveyancers have let down home buyers by not recognising the risks of coastal erosion and landslides, MPs have said.
The environment, food and rural affairs committee said it was “unacceptable” that homebuyers had been left without this “vital” information given that clear risk data is publicly available
The risks should be included by conveyancers and estate agents as ‘material information’, as part of the government’s reform to the home-buying process, it said.
In a report on the impact of coastal erosion on communities [1], the committee said: “Coastal erosion and landslides are not adequately recognised by the conveyancing profession.
“This can result in buyers–especially those not seeking a mortgage–purchasing without a full understanding of the risks.
“North Norfolk District Council said that ‘it is not a credible assumption to state that buyers are at fault for purchasing properties at risk when they have followed due process that fails to identify and inform of the risks identified by government’.”
Being able to sell properties within the risk zone but not at imminent risk “could allow families the flexibility to move on where needed, while sustaining the viability of coastal communities and avoiding a ‘spiral of decline’”, the report went on.
The main methods by which coastal erosion risk is communicated are through the National Coastal Erosion Risk Map and the Digital Shoreline Management Plan Explorer Tool.
The Environment Agency expressed frustration to MPs that, despite efforts to ensure the map was open-source and free to access, buyers were “not actually given information to make an informed choice”.
It also called for requirements on mortgage lenders, estate agents and other brokers to use the available risk information.
The committee noted that, under the Consumer Protection from Unfair Trading Regulations 2008, it was an offence to omit material information from property listings.
“However the onus is on the trader to determine what an average consumer needs to know to make an informed decision, as there is no prescribed list of what constitutes material information in different types of transactions.”
The committee said the government consultations last year on home buying and selling reform, and material information in property listings, were an “important opportunity to introduce mandatory risk disclosure and standardise material information in property transactions”. Their absence created a “regulatory gap”
Guidance should also consider the surrounding area of the property, and wider potential impacts such as access and utilities, mortgage availability, and the availability of insurance products.
More broadly, the report made recommendations to the government on practical ways to help people with issues around insurance, demolition costs and relocation.
Committee chair Alistair Carmichael MP said: “Coastal erosion blights communities the length of this country and is a problem that will not go away. The testimony we heard from affected residents was deeply moving. Amid the prospect of losing their home and community, they deserve dignity, sympathy and, above all, practical help to move on with their lives.
“Previous governments have introduced policies to help households and businesses, but this has been done in a piecemeal way and some, like assistance grants, are no longer fit for purpose.
“The committee now calls for a review of regulation around conveyancing and support offered to those at risk, particularly around insurance and relocation.”