Fracking threat to UK house prices?
Filed under: House Prices
Home owners in the North West, some parts of Sussex, Surrey and Kent are particularly vulnerable to such new property price tremors.
Need to know: Savings
What the frack is going on?Why should home owners be concerned? Because shale gas extraction - drilling deep into the ground then injecting the cavity with chemicals, sand and water, splitting the rock and releasing methane gas - carries with it a raft of potential health risks: from air and water pollution, a risk of chemical spills plus increased risk of subsidence.
Need to know: Savings
Such worries could affect the value of your property. One fracking company working in North West England is Cuadrilla Resources. It has around ten fracking sites in the UK, mainly based in the Lancashire area, though it has plans for some exploratory tracking in Balcombe, West Sussex, Cowden Kent and Lingfield in Surrey.
"Very loud bangs"Some local resident groups like Residents Action on Fylde Fracking are monitoring fracking in their area closely. "I have had damage to a piece of outside brickwork with a large crack," said one recent resident report.
"I suspect," it went on, "I have further hidden damage and have started proceedings against Cuadrilla who have apologised for not having informed local people of the explosions with the requisite 21 days beforehand."
"Very loud bangs in Kirkham today (21/06/12)," wrote another, "around 4pm-5.30pm-shook whole house, and even made a dining room chair jump up from floor, scared children and neighbours who were previously oblivious to Fracking."
Insurance concernSmall earthquakes from fracking in the Blackpool area have already caused concern. However fracking is thought not to be capable of causing major structural damage to property, though minor damage is a worry, plus the threat of increased insurance premium hikes.
Association of British Insurers (ABI) spokesperson Malcolm Tarling told AOL Money that no premiums have risen so far. "Insurers are keeping a watching brief on the issue. At this moment in time there is no evidence that this procedure is leading to particular problems that would involve an insurer." Looking ahead, he added: "There may be more evidence that comes to light."
Energy potentialSupporters of the fracking process point to the UK's increasingly reliance on external energy supplies. Shale gas exploration in the US has helped lower energy prices there. Exploration companies have pointed to South Wales as being another major potential area of shale gas reserves.
Some home owners though remain highly sceptical. John Johnson of estate agent Farrell Heyworth from the Lancashire town of Poulton-le-Fylde, close to a main tracking drilling, told the Guardian: "There are a lot of properties coming on to the market, and some of the owners are saying they want to get out before prices start dropping."
Another concern about fracking is not the technology per se, but the risks of getting it wrong.
Cuadrilla Resources did not respond to this story.