The Risks of Buying a Property on Contaminated Land

21/11/2018
(Last Updated: 19/02/2024)
23,554
6 min read
Key Takeaways
  • Your local authority search and environmental report flags potentially contaminated land under or near your property.
  • Some lenders won't offer a mortgage where contaminated land is present.
  • All lenders want information about contaminated land in the Local Authority Report, but not all lenders want to know if it is only found in the environmental report.
  • Your solicitor must obtain clarification from the council confirming if there is contaminated land.

Your local authority search and environmental report flags if there is any potential risk of contaminated land under or near your property. In the majority of cases, the contaminated land data isn't up to date, and the contaminated land has been treated/remedied; however, your solicitor needs to investigate if this is the case.

What is contaminated land?

The term contaminated land is generally used to describe land polluted by heavy metals, eg arsenic, cadmium and lead, oils and tars, chemical substances and preparations, eg solvents, gases, asbestos or radioactive substances.

From a legal perspective, contaminated land is defined as where substances could cause:

  • significant harm to people or protected species; and/or
  • significant pollution of surface waters or groundwater.

This definition refers to contamination caused by past uses of sites such as:

  • former factories
  • mines
  • steelworks
  • refineries
  • landfills

What do your mortgage lenders require?

When you're buying with a mortgage, your mortgage lender has set criteria for matters they require to be reported to them, and contaminated land is one of them. In the mortgage lender's handbook, it states:

"5.4.4. You (the buyer's solicitor) must advise us of any contaminated land entries revealed in the local authority search. Check part 2 to see if we want to receive environmental or contaminated land reports (as opposed to contaminated land entries revealed in the local authority search). If we do not, you do not need to make these enquiries on our behalf."

Part 2 is the specific lender's position, which varies by lender. For example:

Mortgage Lender
5.4.4 Does the lender want to receive environmental or contaminated land reports?

Barclays Bank Plc

Not desktop reports but any intrusive or investigative reports should be referred to the Issuing Office.

Santander UK Plc

No, unless the valuer asks in his valuation report (and a copy of the valuation report is sent to you) for enquiries to be made. If he does then you should send details to the Mortgage Operations office instructing you.

Nationwide Building Society

We do not require environmental or ancillary reports (e.g. flooding, contamination, and energy and infrastructure reports) that you have requested for the borrower, even if adverse information is revealed, provided the borrower is aware and you have advised them that full disclosure must be made to the insurer prior to completion and they must obtain insurance under normal terms.


The above positions can change so you can check the up-to-date position here - UK Finance lenders' handbook.

How do you find out if your land is contaminated?

As part of the conveyancing process, you order an Environmental Search, including information about flooding, radon, ground stability, energy and infrastructure and contaminated land. Information about contaminated land may also appear within your local authority search.

Environmental risks affecting your property's value?

  • Includes an analysis of all environmental risks, such as contaminated land, flood, ground stability and energy and infrastructure.
  • This is usually a mandatory search when you buy a house.
  • Report delivered within 1-2 working days*
  • Fixed fee of £69 INC VAT


£69 INC VAT | Report within 1-2 working days*

Environmental Search
  • More detailed report, usually requested by the solicitor or lender if a risk is flagged in your conveyancing searches
  • In-house environmental consultancy expertise
  • Report delivered within 10-20 working days*
  • Fixed fee of £360 INC VAT


£360 INC VAT | Report within 10-20 working days*


Does contaminated land affect many residential properties?

In the majority of cases, the Environmental Report will show no risk; however, you’ll need to do more investigations if the environmental report states the following:

"Our environmental consultants, Argyll Environmental Ltd [or other provider of Environmental Search], have identified a significant risk of contaminated land within the vicinity of the property."

If your report states this then you must seek further advice from your solicitor and look to find out from the council whether the land your property is built on actually is affected by contamination.

What can you do if your property is built on contaminated land?

  1. Write to the Environmental Health Department.
  2. Obtain a copy of the Building Warranty Certificate (NHBC) from the sellers.
  3. Contact the Planning Department at the local authority.
  4. Get Residential Contaminated Land Indemnity Insurance Policy.


  • 1
    Write to the Local

You can write to the Environmental Health Department at the Local Authority or to the Environment Agency. You want to find out if the information in the Environmental Report is current or if the contaminated land has been remedied. Here is an example letter:

Contaminated Land Template Letter

Dear Sir / Madam,

Re: Potential contaminated land under PROPERTY ADDRESS

I am purchasing the above-mentioned property, which has been flagged in my environmental report (attached) that the property is potentially built on contaminated land.

Please can you help me by providing:

  • Any information regarding past industrial land use(s).
  • (If applicable) Information on the nearby landfill site e.g. the nature of the fill materials and the dates of infilling, and whether there are any gas protection measures at the landfill and the property.
  • Any site investigations/remedial works carried out at the property or in close proximity.
  • Information on any pollution incidents/ records of contamination.
  • Whether they have any concerns regarding ground conditions on or adjacent to the property site.
  • Whether the site has been risk ranked in accordance with their Contaminated Land Strategy and if so what level it has been assigned (Low, Medium or High; Category 1, 2, 3, etc).

I appreciate your help in this matter and look forward to hearing back from you shortly.

Yours faithfully,

CLIENT NAME

Download a template letter to send to the council


Contaminated Land Contact Details & Costs by Council

Council
Email
Fee
London Borough Council of Hounslow

Landquality@hounslow.gov.uk

£115

Stockport Council

lisa.allott@stockport.gov.uk

Free

London Borough of Hammersmith & Fulham

Alasdair.Carlin@lbhf.gov.uk  

£60

London Borough of Tower Hamlets

environmentalhealth@towerhamlets.gov.uk or
Ohione.Ilavbare@towerhamlets.gov.uk

£173

Havering London Borough Council

environmental.health@havering.gov.uk

£77
Reduced
questions

Bristol City Council

tessa.okane@bristol.gov.uk

£37.50

London Borough of Barnet

scientificservices@barnet.gov.uk
Michael.Polyviou@barnet.gov.uk

£47.50 - 
Sometimes free

Milton Keynes Council

nicola.adshead@milton-keynes.gov.uk
john.rasell@miltonkeynes.gov.uk

£90.50 per hour

St Helens Council

christopherculley@sthelens.gov.uk

£TBC


  • 2
    Obtain a copy of Building Warranty Certificate (NHBC) from the sellers

An NHBC Certificate or Cover note dated after 1st April 1999 for the property with contaminated land cover included within the policy will provide insurance against contaminated land. If the warranty provider is Zurich/Premier/LABC, then as long as the policy schedule shows contaminated land or environmental impairment cover is included, this will be fine as well.

  • 3
    Obtain planning permissions details from the Planning Department (local authority)
  • Planning permissions for the site that include conditions associated with contaminated land.
  • Written confirmation from the local authority that any relevant conditions have been fully discharged.

  • 4
    Obtain Residential Contaminated Land Indemnity Insurance Policy?

An indemnity policy can be obtained to protect against the losses for complying with a remediation notice. The cost of the policy can vary from £180 upwards, so it can often be more beneficial (cheaper) to go to the council to check their records to see if there is contaminated land.

Andrew Boast of Sam Conveyancing
Written by:
Andrew started his career in 2000 working within conveyancing solicitor firms and grew hands on knowledge of a wide variety of conveyancing challenges and solutions. After helping in excess of 50,000 clients in his career, he uses all this experience within his article writing for SAM, mainstream media and his self published book How to Buy a House Without Killing Anyone.
Caragh Bailey, Digital Marketing
Reviewed by:
Caragh is an excellent writer in her own right as well as an accomplished copy editor for both fiction and non-fiction books, news articles and editorials. She has written extensively for SAM for a variety of conveyancing, survey and mortgage related articles.

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