The impact of climate change on the housing market

Climate change has always existed, but the acceleration in change over the last 40 years has made it an issue that each person in a property transaction has reasons to be concerned about.

Homebuyers are more familiar with climate change and have begun factoring in environmental and energy efficiency concerns into their decision about whether to buy. Lenders are keen to understand the potential risk of climate change to their investment, meaning conveyancers are now under pressure to become climate experts overnight. Whilst the full extent of climate change on properties is not fully known yet, what we do know is that we need to understand the physical risks, like flooding and erosion, and the transition risks, like energy performance, on all properties being sold and bought.

Extreme weather, such as high winds and heavy rain, has a physical impact on houses. High winds can dislodge roof tiles, whilst heavy rain increases the risk of flooding.  

Flooding can cause major issues for homebuyers and owners and often causes significant damage to property. Much of the existing infrastructure, like sewers and drains around a property, does not have the capacity to deal with sudden and heavy rainfall. In turn, this can result in water backing up around a property. This risk of flooding, along with threat of subsidence and coastal erosion, is taken into consideration by a potential lender. If the threat is high, it might affect your client’s ability to obtain a mortgage.

According to recent research carried out by Landmark, it is not just lenders that have concerns on this issue. 79% of homebuyers are worried about the risk of climate change to a potential property. Hot summers and wet winters have made the effects of climate change more prominent in homebuyers' minds. The energy performance of a property is also becoming a big consideration to homebuyers, so in-depth knowledge of insulation and ventilation is wanted as well. Homebuyers' concerns can cause delays to transaction times, offers to be reduced after initially being accepted and transactions to fall apart all together.  

With extreme weather occurring more frequently, and climate change impacting properties in a physical way, it has never been more important for you and your client to understand how climate change might affect a prospective sale and the house itself. The good news is we offer reports that will give your clients the most accurate climate information about their properties. Our partners, Landmark and Groundsure know the importance of understanding all the risks, including climate change, involved in property transactions.  

The Landmark Climate Change Report is a desktop report, designed to enable property professionals to understand how climate change could impact a given property. The report gives the ability to inform on short, medium and long-term physical and transitional climate-related risks for a specific property along with advice and recommendations.

Groundsure include their ClimateIndex data in four of their environmental reports, Avista, Homebuyers, Screening and Review, at no extra cost. The ClimateIndex provides simple answers on climate change concerns. They look forward up to 30 years which covers most mortgage terms, giving peace of mind to lenders and homebuyers.  

For more information about our climate change offerings, or if you have any questions about which report to order, please get in touch with our Customer Service team on 0800 085 8050, speak to your account manager or contact us here.