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Fracking risks reducing house prices by 30%

  • 24/06/2013
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North West homeowners could see the value of their property drop by 30% if the government continues to push fracking, a surveyor has warned.

In late 2012 the government gave a firm the go ahead to resume fracking in Lancashire – a process of pumping water and chemicals underground in order to force out shale gas.

The activity temporarily stopped after reports of tremors.

e.surv business development director Richard Sexton told Mortgage Solutions announcements of other major projects such as the High Speed 2 rail link were followed by a depreciation of value in the areas affected.

He said: “Most people if they have a choice won’t live next to a mine. But there is another issue. That is called an earthquake and it is a bit more real. If you are getting tremors that might damage the property the lender is going to be worried.”

“High Speed 2 affected prices by up to 30% for a period of time. With fracking, the fear is this could actually damage the property. But it also depends what is going on in the wider economy.”

More clarity from the government could help reduce fears and stabilise prices, he added.

The example of fracking in the United States suggests while the controversial practice may affect house prices, an influx of oil workers could also open up buy-to-let opportunities.

Buy-to-let investment opportunities in North Dakota have predicted rental returns of 13%-15% for corporate tenancies.

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