Whilst the news might be full of Brexit and the announcement that the whole HS2 project is subject to an independent review, the enabling works for one of the UK’s largest transport infrastructure projects are still happening somewhat unnoticed in the background.

The route for the first phase between London and the West Midlands has been agreed and is expected to be open by 2026. The second phase, with the routes leaving the Midlands to Manchester and Leeds are still to be finalised, but still expected to be open by 2027.

Any project of this scale will always cause huge disruption, which requires the Government to compulsory purchase property and land along the construction corridor (the HS2 Safeguarded Area), to allow the railway line to be built, along with the associated stations, viaducts, tunnels, etc.

However, it’s not just those within this strict corridor who are affected. Property owners close to the route are likely to witness a drop in value, given their proximity to 400m-long trains with as many as 1,100 seats, passing at up to 250mph, every 3 to 4 minutes.

Compensation available at a price

If the route of the new line is through or close to you, it may have ‘blighted’ your property – reduced the value and marketability of your house, land or commercial property. In certain circumstances, the Government will compensate you, but proximity to the route will determine how much.

HS2 Safeguarded Area – this is the actual route of the construction itself and if your property lies within this, you can submit a ‘Blight Notice’ application.

If successful, you can sell your property to the government at the full un-blighted market value and may be entitled to additional costs like legal fees.

HS2 Rural Support Zone – this area is defined as 120 metres from the centre of the new rail line and if your property falls within this region you have options:

• Receive a cash offer of 10% of the value of the property up to a maximum of £100,000
• Apply under the Voluntary Purchase Scheme, where HS2 will purchase your property at the full un-blighted market value of the property. You will not however be able to claim for additional costs
• Apply under the Need to Sell Scheme, which has a number of conditions, but you must have marketed your property for 3 months and have received no offers within 15% of the un-blighted market value.

If you manage to sell your property through one of these discretionary schemes, you may be able to rent back your property from the Government, allowing you to continue living in the property until you find somewhere else to live.

HS2 Homeowner Payment Zone (Phase 1 only at the moment) – again, depending on the distance of your property from the centre of the train line, you could receive a lump sum payment, with compensation zones as follows:

• Properties 120 to 180 metres from the line – £22,500
• Properties 180 to 240 metres from the line – £15,000
• Properties 240 to 300 metres from the line – £7,500

It should be noted that if you later go on to sell your house to HS2, any compensation paid under this scheme will be deducted from the price the Government pays for your property.

The Blight Notice procedure

Now we get to the crux of the matter for those property owners affected by HS2; those whose property has become blighted because the property falls within the Safeguarded Area and they wish to sell.

Firstly, in addition to the proximity of the property to the route, to qualify to secure a Blight Notice, you must be one of the following:

• A resident owner-occupier of a private dwelling
• An owner-occupier of any business property where the Rateable Value does not exceed £36,000 (£44,200 within Greater London)
• An owner-occupier of an agricultural unit with at least six months occupation
• Certain mortgagees and personal representatives

An owner of an investment property is not entitled to serve a blight notice.

If you meet the criteria to serve a Blight Notice, which is then accepted by HS2 Limited, the prospective compulsory purchase is brought forward. However, like all such matters, the time taken to complete the sale to HS2 Limited is critical.

It is obvious from our work with clients that a degree of confusion exists around understanding the deadlines set by HS2. It is widely believed that if you are accepted under the Blight Notice scheme you have three years to complete negotiations with HS2.

However, you have three years to not only complete the negotiations, but to complete the sale itself. If you don’t the Blight Notice will cease and a new Blight Notice will need to be served. There is no guarantee that HS2 would accept a Blight Notice a second time.

If prior to the 3 year deadline you do not complete the sale and still wish for HS2 to purchase your property under the Blight Scheme you would either have to make a reference to the Land Chamber (Upper Tribunal) to protect your position or agree with HS2 to extend the Blight Notice period, which is not always straightforward.

Given the scrutiny under which the HS2 project is now operating, the pressure to keep the overall costs of the project as close to the original estimates as possible and the potential consequences should the Independent Review result in the HS2 scheme being cancelled either in whole or in part, the criteria will be followed to the letter, with very little leeway given, which could impact on any agreement for an extension.

Ansons are currently assisting clients affected by HS2, particularly those on the phase 2 routes north of Birmingham through Staffordshire and beyond, helping with the submission of Blight Notices where appropriate and applications under discretionary schemes.

If you believe your property will be affected by HS2, please contact Neil Faunch or Chloe Ravenscroft, members of our Commercial Property Team, on 01543 263456 or email: nfaunch@ansons.law or cravenscroft@ansons.law