Knotweed has been growing (sorry) under the radar for years. Those days are over. That’s the good news. The bad news is that its public arrival affects more than just homeowners that have it, it impacts the larger real estate market. The impact isn’t pretty.
Look no further than merry old England to get an idea of where things might be headed. In the UK, knotweed has lowered property values, killed mortgages, and turned neighbor against neighbor. As knotweed increasingly stalks property owners in the US, the UK experience may be a harbinger of things to come.
Knotweed: property values & mortgages
Knotweed in the UK
The word “knotweed” strikes fear into the hearts of most British homeowners, and it should. The United Kingdom’s Environment Agency describes knotweed as “indisputably the UK’s most aggressive, destructive and invasive plant.”
Knotweed has had a severe effect on many residential property sales, often lowering home values by up to 15%. After all, properties with Japanese knotweed are a lot harder to sell. In addition to the stigma that surrounds the plant, its presence can have a huge impact on a buyer’s resources and wallet. So much so that UK sellers are now legally required to disclose if their property has -- or has ever had -- knotweed.
This is a standard piece of the property conveyance process in the UK. Failure to disclose knotweed and misrepresentations can lead to court cases.
But wait, it gets worse.
Knotweed: lenders and insurance?
if Japanese Knotweed is growing within seven meters of the habitable portions of a dwelling in the UK, the property is considered unmortgageable. Many lenders extend this consideration to the overall property line. In other words, if your neighbor has knotweed, your mortgage might be in jeopardy. Oof! Many lenders require a professional treatment plan with an insurance-backed guarantee before they will lend. Knotweed may also negatively impact property insurance coverage and associated requirements. And then there are the nightmare stories.
As more US mortgage lenders have come face-to-face with the reality of knotweed, properties containing it have come under increasing scrutiny. The UK experience is scary but instructive..