12th Sep 2018

Japanese Knotweed – Have mortgage lenders got it wrong?

For the last few years it has been the accepted understanding that Japanese Knotweed is an invasive plant which, if left untreated, can cause structural damage to property.

As a result, if a mortgage lender’s surveyor detects it within the boundaries or, more controversially, outside the boundaries of a property being offered as security for a mortgage, most lenders will refuse to accept that property without evidence that the plant has been eradicated by a specialist company offering an insurance backed guarantee.  Not only may that prove expensive, it’s also going to cause delays and delays in conveyancing are most people’s biggest complaint about house moving.  More worryingly for home owners, the presence of Japanese Knotweed may have a detrimental effect on their property’s value.

The Royal Institution of Chartered Surveyors (“RICS”) advises that if Japanese Knotweed is evident within seven metres of “a habitable space” – and I understand that means a property’s boundaries, not just any building’s boundaries – then a value for mortgage purposes cannot be put on the property.  The effect of that non-valuation is that most mortgage lenders will then refuse to accept that property as security unless treatment has been carried out to eradicate the plant as outlined above.

Japanese Knotweed has been singled out to such an extent that it appears as a specific question on the Property Information Form completed by sellers and used by most conveyancers. My colleague, Chris Langford, also highlighted the importance of establishing if a property is or may be affected by this non-native species, citing a couple of recent Court cases, in his blog “The legal implications of Japanese Knotweed in a neighbour's garden” published on our website in February 2018. 

Is the prevailing wisdom right or knot? 

But have we all got it wrong? According to a recent study at Leeds University Japanese Knotweed may be no more of a threat to our properties than any other fast growing plant. 

Among other research, lead author Dr Mark Fennell and co-author Professor Max Wade, together with Dr Karen Bacon, inspected 68 abandoned properties in the north of England. They have now challenged the assumption that Japanese Knotweed can cause structural damage to property and also that the seven metre rule advised by RICS is appropriate.  They acknowledge that the weed can cause damage to paths, drives, and boundary walls etc and can exacerbate existing structural problems but state that there is no evidence that it will cause significant damage to normal property foundations, which is what we have all been afraid of. 

It is, however, an extremely pernicious plant which will find its way out if built over so should we really be asking developers building new properties if Japanese Knotweed was present prior to development?  From a residential point of view, most new homes will have the benefit of a 10 year guarantee to cover structural damage but personally I would like to know beforehand rather than have to make a claim in the future.

Leeds University’s report appears to have been welcomed by the Property Care Association but at time of writing, I could find no mention of it on the RICS website. Indeed, I only found out about it today whilst listening to Dr Bacon on You and Yours on the radio! 

So what should you do if you’re buying or selling a property affected by Japanese Knotweed?  At the moment, we are not aware of any current advice having changed as a result of this report but if Japanese Knotweed is highlighted by an RICS surveyor resulting in a mortgage lender refusing to make an offer, it may be worth asking the lender to re-consider.  Let your solicitor or conveyancer know straight away, of course, so that they can make further investigations if necessary.

Diane Scott is a Conveyancing Executive within Berwins' CQS accredited Residential Property team

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