So, you’ve finally found your dream forever-home, a beautiful Cornish character property with stunning scenic views of the south-west coast. You’ve been sensible enough to have paid for a full structural survey. The results are in and it is not good news……. “Mundic Block – potentially unmortgageable)”. Just when you thought you knew it all.
If you are already living in Cornwall or Devon, then it’s a term that may already sound familiar to you. “Mundic” is a Cornish term for mining waste. “Mundic block” is a generic term for blocks used for construction, made of mass concrete, comprising waste mining materials mixed with aggregate, such as beach sand, sulphite minerals, furnace residue or flint. Mundic blocks were used for construction of property in the South-West of England, predominantly Cornwall and Devon, between 1900 and the 1950’s, and in some parts continuing into the early 1960’s.
The science bit
Sulphite minerals, often found in mine or quarried rock, can oxidise under damp atmospheric conditions, producing sulphuric acid. The acid then attacks the cement, causing weakness and expansion, commonly called “mundic decay”.
So what?
Whether a property suffering from mundic decay is mortgageable or not will all depend on the result of a screening test. In 1994, the Royal Institute of Chartered Surveyors, with input from the Building Research Establishment, developed a screening test for the purposes of identifying the extent of concrete degrading, caused by mundic block.
The screening test involves extraction of small samples of a building’s fabric using a drill. The samples are then analysed for mineral content, in laboratory conditions simulating extreme weathering, and the results are then given a grade of A1, A2, A3, B or C.
Will it pass the test?
If screen testing reveals a mundic property as grade A1, A2 or A3, you’re in luck. Whilst the concrete may be subject to the need for protection and maintenance, it is otherwise considered sound and the property is generally considered mortgageable.
However, if testing deems a mundic property as either a grade B or C, it is NOT mortgageable leading to an automatic decrease in its market value and blighting the property.
A mundic property classified as grade B means that the concrete contains in excess of 30% of possible problem aggregate(s) and although appearing sound, has the potential to cause problems in the future. Grade C means that the concrete is unsound and repair is needed.
A property’s value can reduce by approximately 25% if it is discovered to be affected by mundic.
Can it be fixed?
In some cases, mundic may only affect a certain part of a property. Your survey should help you to assess the location of any mundic-affected part. Whilst a mundic-affected property might have suffered a decrease in value, the cost of the works to cure the affected area may be far less than the decrease in market value. Specialist advice would need to be taken and detailed surveys carried out. For grade C and arguably grade B mundic property, a structural engineer should be retained to examine the structure.
A bargain?
Worth taking a punt? There is no such thing as a free lunch. You need to be certain that the cost of repair is less than the reduction in market value due to the existence of mundic block. Of course the existence of mundic doesn’t stop the property being let, unless the mundic is so bad that the property is structurally unsound, but a mundic affected property is, effectively blighted to a greater or lesser degree.
What if a test has already been carried out by the current owner?
If you are contemplating buying or selling a classified mundic property, always check the date of the last test. A new test could result in dramatic changes.
As a result of the RICS screening test carried out in 1994, 70% of mundic properties previously blacklisted by the majority of lenders moved back to the approved lending list. Later revisions to the screening test in 1997 and again in 2015 increased that percentage to 80% with around 5% of properties now classified as grade C mundic property.
How much will a test cost?
A screening test may cost approximately £450 plus (plus VAT). The cost could increase, depending on the severity of the mundic decay. But it’s well worth the expense. If you are trying to sell a mundic property, the results of re-testing could increase its value to its full market potential, subject of course to any required remedial works and further re-testing. If you are buying, a test may save you from making a costly mistake.
Mundic-affected properties are very saleable properties and can make great investments, as they sell for approximately 65-70% of the cost of an unaffected property but they can be let for the same price.
We all love a bargain. Understanding how to go about dealing with a mundic property might just help you get one.
This article is for general purpose and guidance only and does not constitute legal advice. Specific legal advice should be taken before acting on any of the topics covered. No part of this article may be used, reproduced, stored or transmitted in any form, or by any means without the prior permission of Brecher LLP.
