Commercial insurance article archive
Sustainable property development in the South East
Thousands of Londoners are flocking to the South East in search of a better quality of life. But is the South East able to sustain them?
EVERY year, hundreds of people flock to London – and cities like it – in search of wealth, career advancement, or sometimes just the excellent social and cultural opportunities the big city has to offer. At the same time, however, there's a similar movement going on in the opposite direction, with thousands more people heading out of the city, looking for a better quality of life. For many of those movers, the South East of England provides the perfect destination for a great escape. Close enough to London to make commuting possible, but far enough away to make the stresses and strains of city life seem like a distant memory, the South East has it all: a comparatively mild climate, a buoyant economy and all the fresh air and wide open spaces that a long-time city dweller could ever need.
Dubbed "Greenshifters" for their desire to leave the smog of the city behind and start a new life in the country, these new inhabitants of the South East are keenly aware of the benefits of their chosen environment. Ironically, however, their very presence there could be placing that environment at risk.
In the towns and villages of the South East, hosepipe bans have become as much a part of summer as Wimbledon, ice cream, and trips to the seaside. While lack of rainfall would normally be seen as cause for celebration, however, falling water tables and the resulting shortages are anything but. Combine the shortage of water and the increasing demand for houses, and we have a ticking time bomb which is set to explode unless a solution to the sustainable housing problem is found – and fast.
According to the Office of National Statistics, around 113,400 people quit London for good in 2003 alone, with a good number choosing the South East as their relocation destination of choice. This influx of newcomers has pushed up property prices in the area, making it that bit more difficult for native South Easterners to get a foothold on the property ladder, and although properties in the South are still significantly lower than in London, the gap is getting smaller as the population increases.
To help meet the growing demand for property, the government has now revealed plans to build over half a million new homes in the area over the next twenty years, with much of the new development taking place in Ashford and Milton Keynes. According to South East County Leaders Chairman, Keith Mitchell, however, those homes could be left without fresh water unless changes to the area's infrastructure are made.
"Without more investment in water supply and sewage treatment," he commented, "millions of families living in the South East risk regular hosepipe bans and severe water shortages."
Hosepipe bans which used to cover only the driest months of the summer are now in effect all the year round in some parts of Kent and Sussex, and the Environment Agency is now so concerned about the situation that it is calling for five new reservoirs to be created in the area in the next five years. The South East's existing reservoirs are currently only around 40% full, and as summer hots up, those levels could fall still further. If an additional 200,000 households start drawing on that rapidly dwindling water supply, there are fears that the current situation could turn into a fully-fledged crisis.
The area's water troubles don't end there, though. In fact, far from having too little water, the proposed new homes may well end up with more water than they bargained for, if rising sea levels cause the area to flood – an eventuality which insurers are already preparing for.
The threat of flood is a very real one, with many of the proposed new homes set to be built on an area already prone to flooding. Unless strict flood-prevention measures are taken, the properties may be uninsurable, warns the Association of British Insurers (ABI), leaving home owners at risk of losing everything to flood.
The ABI has already estimated that, should the new developments go ahead as planned, flood damage to the properties would be likely to cost the insurance industry something in the region of £56 million per year – an unacceptable risk. "The premiums would either be so high that people could not afford to pay them, or the industry might think the risk was unacceptable at any premium," says Jane Milne, head of household and property for the organisation. Bad news for home owners and insurers alike.
The root of the problem lies in the Thames Gateway, where flood defenses for Thames tributaries are in poor condition. This, combined with the climate changes which have seen sea levels rise, could turn the area of England with the lowest annual rainfall into the area with the highest chance of flooding. So what’s the answer?
"Insurers want to offer insurance to as many homeowners as possible," comments the ABI's Peter Downer. "With increasing demand for new homes, pressure on available land and the impact of climate change we must ensure when planning new developments that adequate measures to manage the flood risk are incorporated. We also need to see flood resilience built into new properties. This means that a high standard of protection remains in place over the life of the development, and also looking at ways to reduce the impact of flooding.”
The ABI and Environment Agency continue to try to work with the government to ensure these measures are put in place in the South East. Meanwhile, home owners who live in an area where there's a high risk of flood can do their bit to improve the resilience of their property to flood damage. Practical measures to protect against flood include replacing wood flooring with concrete or tile, replacing MDF kitchen and bathroom fixtures with plastic ones, and moving service meters, boilers and electrical plug points above the anticipated flood levels. Download more detailed advice on flood resilient homes from the ABI website here.
24 Jul 2006