Buying a House > What is a homebuyer survey?

Buying a property is as scary as it is expensive. As with any purchase that involves a lot of money, there’s always an element of risk involved. Yes, a lot of people will tell you that ‘you can’t lose money on property’, but things can, and do, go wrong.

Houses are expensive. They are expensive to build, maintain, and repair. If you’re buying a property, you’re parting with hundreds of thousands of pounds, so you understandably want to know what you’re getting for your money.

But how can you protect yourself from things going wrong?

Well, in some cases, you can’t. Natural disasters, accidental fires, theft and arson are impossible to avoid. But what about hidden structural damage, historic damp, and other hazards?

There’s nothing worse than the idea of buying your dream home only to find out it’s a nightmare underneath. You’ve spent all that money, invested all of that time and endured all of that stress, so what do you do to stop an issue like Japanese Knotweed wreaking havoc and crushing your dreams? You undertake a homebuyer survey.

 

What is a Homebuyer Survey?

Homebuyer surveys can protect you for potential issues that may become bigger problems in the future. They help you gain an understanding of how much you might need to invest in property repairs and can be a useful tool in deciding whether the property is the right one for you, as well as if you need to change your offer.

There are many different types of surveys available to buyers, so you need to understand what they are, what they involve and which survey you need.

Don’t let price lead the way when deciding what survey you require. While a more extensive survey may require a higher initial outlay, it could end up saving you a fortune in the future.  Preventing expensive repair costs once you’ve got through the door.

RICS Condition report

The cheapest survey available to buyers is the Royal Institute of Chartered Surveyors (RICS) Condition Report. Usually costing £250, this survey looks at the general condition of the property and identifies any risks, defects, legal issues or potentially dangerous hazards.

The survey offers no advice on valuations or repairs and is best suited to newer builds that are in good condition. If you’re looking at an older property, you may be best going with some of the options below.

RICS HomeBuyer Report

The HomeBuyer report is slightly more expensive than the Condition report, but it goes into more detail than its cheaper counterpart. The average report costs around £400 and will advise if there are any structural problems, such as damp or knotweed, both inside and outside of the property.

While a HomeBuyer report won’t strip up the floorboards or go behind the walls, it will help you negotiate the price on the property. Not all HomeBuyer reports include a property valuation, but if yours does, you will be able to revise your offer if the survey comes back with a valuation price lower than that of your lender.

Similarly, a HomeBuyer report will advise on any repairs needed to the property. These repairs can be used as a bargaining tool when negotiating the price. If it’s going to cost £10,000 to repair a certain issue, you are within your rights to ask for this to be knocked off the asking price or remedied before you proceed with the purchase.

 

RICS Building Survey

Coming in at around £500, the RICS Building Survey is an in-depth inspection that uses a simple 1,2,3 rating system to identify the most serious issues with your property. The Survey is mainly aimed at older properties that are more likely to have structural issues, and the data is presented clearly, making it easy to understand to potential buyers who may not know what they’re looking at.

The report is an in-depth analysis of the property and its condition, with the survey being capable of identifying a range of issues and provide advice concerning repairs and maintenance. An RICS Building Survey also includes several advice sheets on how to deal with common issues concerning your property and what the impact of not dealing with these hazards could be.

Again, while the Building Survey is slightly more expensive than other options, its in-depth nature and easy to understand formatting means that it could save you a lot of money and a headache in the future.

 

Building and full structural survey

A building and full structural survey most comprehensive survey on the market. The survey is suitable for all types of property but is particularly useful if you’re interested in an older home or a ‘project’ property that may need repairs and a lot of work carried out before it’s habitable. While it’s the most expensive survey offered (costing £600+), the Building and full structural survey goes into more detail than any of the other options above.

The survey doesn’t usually include a valuation and cannot look under the floorboards or behind walls, but it will include a professional surveyor’s opinion on whether there are any potential defects with the structure of the property and their recommendations for how to get them fixed.

Part of the appeal of this survey is that the surveyor will provide information on potential repairs, which is useful when looking at the lender’s valuation of the property. If the repairs are likely to cost you a lot of money, you could consider asking for this to be knocked off the property’s valuation or ask for the seller to remedy any issues before you continue with your purchase.

 

Snagging Survey

If you’re in the market for a new-build, you are well within your rights to expect the home to be in perfect condition when you move in. However, even the most rigorous of developers will make mistakes or cut corners during the building process.

New-build snagging surveys cost £300 and are undertaken by an independent party. The surveyor will look for any defects in the home, and the developer will then be tasked with fixing these issues before you move in.  It could be something as small as a creaky door or poor paintwork, or it might be something more serious, such as bad electrical work.

To ensure the blame doesn’t lie at your feet, the snagging survey needs to happen between the development being completed and you getting the keys and occupying the property.

What happens after a survey?

Unless you’re extremely lucky, it’s highly likely that a property survey is going to come back with some issues, particularly if you’re buying an older property. Some of the problems you may already know about, but others may come as a shock.

If you’ve spotted something that has concerned you in a previous viewing, or you would like to re-visit the property, you are allowed to join the surveyor when they’re carrying out the survey. This is a good time to bring up any issues that may have concerned you in the past and to ask any questions that you may have regarding the property in question. It may be something small, but you should never feel like you can’t speak up and ask for advice.

The most common issues that arise after a survey include electrical, roofing, heating, damp and structural problems. They will most likely require further investigation and may need repair, so make sure there is space in your budget for potential repair work.

How to estimate repair costs

If your property survey does come back with multiple issues, ask your surveyor how much repairs are likely to cost. If there’s major structural work that needs to be completed, ask a building company for a quote and use these figures to renegotiate the asking price or ask the seller to sort the repairs before the sale is completed.

If the property is in such a bad state of repair that it will require months of costly labour, you are within your rights to walk away from the deal as no contracts have been signed and the handover of ownership has not been completed. While this may be the last resort, never feel pressured into buying a property and be sure to take your time and consider any doubts that you may have.

 

Mortgage Valuation Survey

The last property survey to look at is the Mortgage Valuation Survey. This survey is a compulsory survey, with the sole aim being to satisfy the lender that the property is worth the price you’re paying for it. Without this survey, your mortgage application will not be accepted.

The valuation survey will not reveal any repairs or structural issues that need to be remedied and it will not provide any advice on how to sort any problems that the property may have.

Some mortgage lenders offer a mortgage with a free valuation survey, but it’s generally the case that the buyer has to stump up the funds. Depending on the size of your property, a valuation survey can cost anywhere between £150-£1,500.

The majority of valuation surveys will clear the property to be sold at the advertised price, but that’s not always the case. If the survey values the property below your asking price, you can use this as leverage to lower your offer based on the survey. However, if the estate agent or seller refuses this offer, you will need to dispute the valuation with your mortgage lender to attain to mortgage required to buy the property. You can do this by providing evidence of similar properties in the area selling for the same price or higher than the seller’s required purchase price.

How to find a surveyor

If you are in the process of buying a house and need a surveyor, do your research before you commit to a certain company. Any surveyor that you hire should be a member of a recognised governing body such as the Residential Property Surveyors Association (RPSA) or Royal Institution of Chartered Surveyors (RICS).

If you’re unsure of how to find a surveyor, ask your friends or family if they have any recommendations. You can also ask your estate agent or your solicitor but be warned that there may be a commission fee involved with their recommendation, meaning it may cost you more money.

 

Property surveys can be arduous, expensive and frightening, but they’re a worthwhile expense. A property may look like the home of your dreams for the outside, but who knows what nightmares await once you’re in. It’s important to remember that this is your potential home; you’re paying a lot of money for this property, so why take any risks?

Not only will a property survey save you from any potential headaches and surprising costs once you’re moved in, but they can also be used as a bargaining tool in the home buying process.

As always, if you’re ever unsure about something during the home-buying process, do not be afraid to ask questions. Happy house hunting!