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Surveyor Blog: Assessment of Asbestos in Residential Valuation

08.07.2020

Asbestos is a generic term for a group of naturally occurring fibrous mineral silicates, comprising fibrous crystals or “fibrils” which can be released into the atmosphere by abrasion and other processes. Asbestos has been extensively mined in Canada, Russia and South Africa since the mid-19th Century. As a good heat resistant electrical insulator, it has been widely used as a building material. Inhaling loose asbestos fibres is known to cause several serious and even fatal diseases such as asbestosis and cancer. The first asbestos related recorded death was in 1906 but there are now 4,500 asbestos-related illnesses per year in the UK.

Whilst asbestos materials have been widely used in the residential and commercial construction industry since about 1860, particularly between the 1950s and 1970s, any property may contain asbestos or asbestos products. As a result of legislation, its use has reduced but ACM (Asbestos Containing Materials) could be in any building constructed (or with DIY improvements) before 2000. Whilst it is not uncommon to find asbestos in residential properties, so long as it is not disturbed or disintegrating it does not pose an immediate hazard to health. It is only when the product is disturbed or damaged and fibres released into the atmosphere that any risk arises.

The Control of Asbestos Regulations state that ‘every employer shall ensure that adequate information, instruction and training is given to those of his employees who are or who are liable to be exposed to asbestos, or who supervise such employees’. All RICS valuers should be familiar with the RICS guidance note on asbestos “Asbestos and its implications for surveyors and their clients” (3rd edition GN 38/2011). This provides a comprehensive discussion on the issues to be considered, including: asbestos risk to surveyors, surveyor’s responsibilities, responsibility of others, services offered by surveyors, limitations and exclusions, insurance, asbestos survey, sampling asbestos, management plan, types of property, asbestos removal, encapsulation, environmental clean, demolition and land clearance.

The three significant types of asbestos that have been commercially used in the UK are: Crocidolite – commonly known as ‘blue’, Amosite – commonly known as ‘brown’ and Chrysotile – commonly known as ‘white’. Whilst a visual inspection may alert the surveyor, having a sample analysed is the only way of ensuring asbestos is present. Colour alone is not a reliable method of identification or of risk. It should also be noted that other building materials, such as Vermiculite (commonly used as loose fill), may be contaminated by asbestos.

For the residential surveyor, being aware of likely asbestos location will help reduce risk of disturbance during inspection. Chrysotile is the most widely used in building material, and is often found in plaster, vinyl floor tiles, roofing felts, panels and pipes, fireproofing and doors. Amosite and Crocidolite can be found in asbestos insulating board AIB, ceiling tiles, asbestos cement sheets and tiles, pipes and lagging. Sprayed coatings, pipe insulation and AIB are the most dangerous due to high asbestos content, whilst loose fill is easily disturbed and breathed in.

Asbestos has multiple uses in building materials not only for the main dwelling house but also outbuildings and garages. Example locations are:

  • Asbestos cement roof sheeting (often corrugated), often on garage roofs and sides.
  • Tiles, slates, gutters and downpipes.
  • Chimneys and flues.
  • Asbestos Insulating Board (AIB) – Used in ceilings, windows, soffits, cladding and door panels (often with indented pattern back surface) .
  • Flat roofs, sarking felt/paper and linings.
  • Textured decorative coatings e.g. Artex.
  • Floor tiles, vinyl PVC or thermoplastic.
  • Textiles (e.g. fire blanket) and composites.
  • Water tanks and cisterns.
  • Sprayed coatings on ceilings, walls, beams and columns, fire protection on structural supports and other building components.
  • Pipe and cylinder insulation and thermal lagging.
  • Loose asbestos in insulation ceilings, wall or floor cavities.
  • General DIY improvements using ACMs.

In the United Kingdom, Crocidolite and Amosite materials were banned in 1985 while the import, sale and second-hand reuse of Chrysotile was outlawed in 1999. The 2012 Control of Asbestos Regulations state that owners of non-domestic buildings (but not residential) have a “duty to manage” asbestos on the premises to be aware of its presence and ensure the material does not deteriorate, removing it if necessary.

In a mortgage valuation inspection whilst the age of a building may be an initial guide as to the likelihood of asbestos content, it will not be conclusive and cannot be relied upon. For example, asbestos may have been used in subsequent alterations, especially to services; furthermore, alterations may have been carried out with (remaining residual) old stocks of asbestos building materials after bans were imposed.

For the residential surveyor, having established presence of ACM, recommending disposal may not be the best course of action. While asbestos may not constitute an active risk in situ, much will depend on the ACM type and its condition. If it does require treatment or removal, the need to comply with regulatory requirements can mean the cost is considerable.

Removal and disposal are the last resort and can only be justified due to poor condition or where the risks of subsequent damage or disturbance are unacceptable. Whilst asbestos cement products may be able to be removed by anyone, some types of asbestos must only be removed and disposed of by licensed experts and guidance should be obtained from the local authority environmental health officer.

Awareness that asbestos is present can, therefore, adversely affect the value of a property. The extent will vary according to the amount and type of asbestos, its condition and location, the ease with which it can be treated (or removed), the size and type of the building and its current or intended use. The presence of a small amount of asbestos in good condition should have only a negligible or no effect.

Over recent years, asbestos has hit the headlines as being hazardous to health and it is becoming more important to advise customers of its suspected presence and potential risks – even though most lenders will lend on properties containing asbestos subject to saleability and valuation.

It should be noted that RICS guidance states that if during an inspection the surveyor identifies or suspects materials to contain asbestos and considers there is an “immediate and significant risk to health” it should be reported to the client irrespective of any conditions of engagement which have been agreed and also to the person in control of the premises (e.g. householder/estate agent).

Policy on valuation reporting will vary depending on the type of ACM, its location and condition. For general ACMs where the condition is good, whilst it should appear in the site notes, there may be no need to mention it specifically in the valuation report. In some cases, an observation putting the client on notice about asbestos could be recorded in a general section of a report. Unless there is clear market resistance to buy, the property should be accepted as security and any effect reflected in the valuation.

Where there are high asbestos content, high risk items e.g. loose or soft products, sprayed coatings, lagging, insulating board, or if the ACM product has significantly deteriorated and specialist repairs/removal are required that may influence value, details should be provided, a recommendation for a specialist report and cost estimates, should be made and a ‘Nil Present Condition Valuation’ given.

In rare cases, the valuer may consider that the presence of asbestos is so extensive or hazardous that it becomes an overriding consideration and it is appropriate to decline the property.

For HomeBuyer Reports (HBR) reporting of ACMs is treated slightly differently, where HBR work should be carried out “with due skill, care and diligence”. The RICS professional statement relating to HBRs states: “The service does not include an asbestos inspection that may fall within the Control of Asbestos Regulations 2012 (SI 2012/632). However, asbestos containing materials, if suspected, should be reported and cross-referenced to section J3 Risks to People.”

Where ACMs are found in property, residential valuers therefore have a lot to consider. Not only the issues relating to asbestos nature, location and condition, but also the effect on saleability, value and reporting decision – but also general client advice.

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