Louis Mason, of Oportfolio, said flood risk is not materially affecting mainstream mortgage volumes, but is becoming more noticeable in areas such as parts of the Thames Valley and for riverside or waterfront homes.
“At the moment, we’re not really seeing flood insurance impacting mainstream mortgage volumes,” he said. “But it is becoming a bit more visible consideration in some areas like parts of the Thames Valley… and for specific property types like riverside or waterfront homes.”
The challenge, Mason said, is usually not whether a client can obtain a mortgage, but whether the associated insurance costs begin to affect affordability and confidence in the purchase.
“The biggest issue is usually around insurance affordability and availability rather than mortgage eligibility itself,” he said, noting that higher premiums, excesses and restricted terms can begin to affect affordability calculations and buyer confidence, particularly for first-time buyers.
Where cover becomes harder to secure, that can also start to slow transactions. Mason said limited insurance options can lead to delays, additional underwriting scrutiny and, in some cases, lead lenders to take a more cautious approach to certain properties.
