We looked into buying a house with Japanese Knotweed a couple of years ago. These were our mortgage providers pretty extensive requirements:
Management plan
1 Once Japanese Knotweed has been identified, and an appropriately
qualified and/
or experienced person has further investigated the problem and provided a
report, a Japanese
Knotweed management plan should be established.
This management plan can provide the necessary reassurance to both lenders
and buyers that a
Japanese Knotweed problem is being properly managed.
2 Although the methods of tackling Japanese Knotweed will depend on the
commercial choices
and preferences of the contractor, the management plan should be based on
that included in the Code
of Practice published by the Environment Agency and should thus be
consistent across the industry.
As a minimum, a management plan should include the following features:
• A description of the property with an accurate record of the Japanese
Knotweed infestation.
• A scaled plan with dimensions and supporting photographs would be
particularly useful.
• The full details of the contracting organisation and a description of the
methods to be used
to eradicate Japanese Knotweed.
• A treatment schedule that is updated as treatments are carried out.
• A completion certificate that confirms the treatment is complete and that
the Japanese
Knotweed at the property has been remediated.
3 Valuers and surveyors should take account of this range of information
when deciding whether the
evidence of previous treatment regimes is adequate.
4 To meet lender requirements, other features could provide additional
reassurance, as detailed
below.
• The current owner must pay all costs associated with the management plan
‘up-front’, so that the treatment programme can be completed without
relying on financial
support from subsequent owners.
• The management plan should be transferable to any subsequent owners.
• The management plan should cover the whole of the property and not just
those
affected parts identified by the original valuer or surveyor.
• An appropriate warranty or guarantee that will ensure that the treatment
programme will be
completed in the event of insolvency of the original treatment
organisation.
5 Important note: It is impractical to guarantee that Japanese Knotweed
will not return following
the completion of a treatment programme.
Consequently, the mandatory insurance should be restricted to ensuring that
the treatment is
completed.
To summarise, with reference to the RICS guidelines, a property where
Japanese Knotweed (JK) is present but is not causing damage should be an
acceptable security subject to a Japanese Knotweed management plan being
put in place that is paid for in full, up front.
The plan will need to be insurance backed (simply to ensure that the plan
is completed, you cannot guarantee that JK will not return).
The plan and insurance must be transferable to other owners during the plan
period.
The firm undertaking the eradication work must be a member of a recognised
trade body such as the Property Care Association.
Putting a plan in place should be a condition of the mortgage advance.
All JK cases will need to be passed to the bank’s underwriters for
consideration.
The above information and guidelines are subject to change and are
currently for indication purposes only.
All purchase applications are subject to valuation and underwriter
consideration.