What Record Rises In Subsidence Means For The Housing Market
Over the past few years, the weather in the UK and around the world has been increasingly unpredictable.
While this has many effects on almost every aspect of our lives, one that many homeowners might not have considered is how it can damage their properties.
Thanks to the hot, dry summers that we’ve been experiencing over recent years, experts predict that there will be record numbers of home insurance claims for subsidence in 2022.
Subsidence is a serious issue for homeowners, and it can also have a significant effect on the UK’s housing and property markets. The problem occurs when the ground beneath a property starts to sink, resulting in damage to the home’s structure.
Here are some of the changes we can expect as subsidence becomes a more prevalent issue in today’s homes.
Greater Awareness Of Subsidence
Subsidence is a common term that many property professionals understand, but some homeowners might not know what it is, how it happens or what to look out for. As more and more properties start to show signs of subsidence, it’s likely that property owners will start to learn more about the issue and how to spot it. Signs of subsidence include long cracks in walls and sloping floors, as well as doors and windows getting stuck. Tenants, homeowners and property managers all need to be aware of these signs and be proactive if they think that a property could have subsidence.
Increased Demand For Subsidence Treatments
Once subsidence is identified, it needs to be treated as soon as possible. As we start to see more cases of subsidence throughout the property market, we’ll doubtless also see an increased demand for treatments to rectify the issue. One of the most common solutions is resin injection underpinning. The process helps to strengthen the foundations of the property and extends deep into the ground around it. If your home or a property you manage is showing signs of subsidence, then explore underpinning options from experts like Geobear. You’ll then be able to get the issue rectified promptly and reduce the chances of the problem getting significantly worse and causing major damage to the structure of your property.
Challenges With Financing Home Purchases
Buying or selling a home with a history of subsidence can be challenging because many lenders refuse to offer mortgages or property financing products for homes with this issue. Once the problem is resolved, then the lender might be more willing to offer a mortgage, but while the problem is ongoing, it will be very hard to get financing to buy the home. Also, even if the subsidence is no longer present in the property, the lender will probably want to know a full history of the issue and be more reticent about lending on a property that has experienced subsidence issues in the past. That’s because these properties could be at risk again in the future, and this could put their investment in jeopardy. As increasing numbers of properties face subsidence, more and more buyers and sellers could face dealing with reluctant lenders moving forward.
Rising Property Insurance Costs
As claims for subsidence-related issues rise, home insurance providers will be exploring ways to recoup the cost of dealing with and paying out for them. That will probably mean price rises that transcend the current inflation rates over the coming months. Also, lenders might consider increasing premium prices or excess costs for homes that have experienced the issue in the past. Rising home insurance prices will put a strain on everyone throughout the property market, particularly the rental industry. Private tenants are already facing record rent rises thanks to soaring interest rates, which means that many landlords without a fixed rate on their buy-to-let mortgage have faced steep increases in costs. With a rise in home insurance premiums as well, tenants will be squeezed even further, as will landlords if they try to absorb some of these costs themselves. As such, almost everyone across the property market will be affected by this development, as home insurance prices have an impact on the prices of services for almost every business in the sector.
Higher Demand For Newer Properties Or Homes With No History Of Subsidence
As highlighted in several of the points in this article already, homes with a history of subsidence are at risk of increased insurance premiums, and buyers could face challenges with finding mortgage lenders. Therefore, it’s probable that, in the future, buyers will be focusing on finding properties that don’t have a history of subsidence. New build homes are most likely not to have any history of subsidence, so these could be a key focus for many buyers over the years ahead. Additionally, modern homes built in the last 50- 100 years are less likely to get subsidence than Victorian or Edwardian homes, as these often have shallow foundations. So, homebuyers could be focusing on modern properties as they look to reduce their property buying and ongoing running costs. That means that developers could find that there’s even more demand for their properties and for newer homes built in the last century, rather than older homes.
A Final Note On The Effects Of Rising Subsidence On The Housing Market
An increase in subsidence in properties throughout the UK will have a significant effect on almost every aspect of the country’s real estate market. Whether you’re an estate agent, property manager, tenant, landlord or private homeowner, you need to be aware of this latest market development and understand how it could affect you. This article should give you the basic understanding you need to grasp some of the most significant effects that rising subsidence issues will have on the UK’s property landscape as we advance towards a New Year and how you can adapt to this latest change. Getting subsidence in your home is never a good thing, but by being proactive and making the most of articles like this, you can make the experience as positive as possible and ensure that you adapt to the problem as best you can.