How conveyancing searches can affect a decision to buy a property

Conveyancing searches are an incredibly important part of purchasing a property. They are required by most mortgage lenders and can reveal crucial information about the property and land that even the seller did not know! The results from searches might be so surprising that you have second thoughts about the property you intended to buy.

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Our conveyancing team will usually advise that a Local Authority Search, Water and Drainage Search and an Environmental Search be obtained for each property, with further relevant searches where appropriate such as a Flood Risk Assessment or Ground Stability reports. We have some example scenarios below of what searches could reveal and how it may affect a buyer’s decision to proceed.

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Local Authority Search

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A Local Authority Search checks for, among other things, whether the property is subject to any planning decisions or enforcement actions, local planning restrictions, preservation orders and plans for new roads schemes nearby.

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Scenario

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A potential buyer intends to build an extension on a house. The local authority search reveals that there is a Tree Preservation Order in place, with trees on the grounds of the property protected such that they could not be cut down or interfered with without express consent from the Local Authority. This may affect a buyer’s decision to continue with the purchase, as there is the risk that consent may not be obtainable. The buyer may want to look for a different house more suited to their project.

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Water and Drainage Search

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The purpose of a Water and Drainage Search is to ensure that the property being purchased is connected to the water and drainage systems provided by a Statutory Undertaker, to determine the position of any infrastructure owned by the Statutory Undertaker and to provide further information on any sewer flooding, leaking or damp caused by public waterways and drains. These searches are usually made with the company which is responsible for providing water and drainage services in the area where the property is located.

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Scenario

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If a search shows a major sewer flood risk, a buyer might reconsider purchasing a property in a risk zone and even the bank itself might not lend the money, affecting the whole property purchase. As with the previous scenario, the position of any infrastructure may mean that an intended extension requires “build over” consent from the Statutory Undertaker before any such works can begin, and this may add extra time and expense to a project or provide uncertainty as to whether such consent will be given.

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Environmental Search

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Environmental Searches check for aspects such as flood risk, contaminated land, gas hazards and landfill sites in the area. The most important part of this search is the certificate that is given by the search provider being usually– “Pass” or “Fail / Further Action required.” A “pass” means that the search provider does not consider the property to be “contaminated land” as defined by the Environmental Protection Act 1990 or at risk of any other environmental or man-made hazard. If the search comes back requiring further action, it may be that your conveyancer needs to obtain further information to show that any known risk for the area has been dealt with (such as by providing an NHBC certificate). In most cases, the search result will then be changed to a “Pass” rating. Many lenders now require a “Pass” or, in the instances of a Failed search, an indemnity to be taken out to cover them in the instance that any action or loss occurs in future due to any risk shown on the search.

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Scenario

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An environmental search could reveal a serious issues for example, ground instability which could include swelling clay, landslip, ground dissolution, running sand, collapsible or compressible ground. Such disclosures may lead to increased insurance costs or for a lender to reconsider their mortgage offer.

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As you can see, it is worth protecting yourself with searches to save you from spending a lot more money on resolving issues. Even if the searches do not reveal any issues it is worth getting them done for peace of mind and most search providers provide search insurance to cover a party in the instance there are any errors.

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If you search for a house address on the Environmental Agency website, you can access long term flood risk information about your chosen property by viewing it on an map.