Your Investment Property: Surveyors
Buying a property is the biggest purchase most people make, yet remarkably only 20 per cent of home buyers in the UK commission a professional survey. Many believe the survey carried out by the mortgage lender is sufficient, but this is in fact no more than a mortgage valuation - an inspection of the property carried out to establish the amount and terms of the loan. The lender's survey will not establish if the property is worth the price asked, nor will it point out any structural defects.
With the average price of a house in the UK now above £230,000, it is crucial to gain as much information as possible about a property before any contracts are signed. Investing a relatively small amount to get the professional opinion of a chartered surveyor can be money well spent.
The two main types of survey are the homebuyer survey and valuation, often called the homebuyer report or HSV, and the building survey. If the property is under 30 years old, appears to be in reasonable condition and is of a conventional type and construction, the homebuyer report will probably suffice. It is the cheaper of the two surveys and will focus on problems and defects that are in urgent need of attention and will affect the property's value.
Real Value for Money
The homebuyer report will include a valuation, as well as a rebuilding cost. Its aim is to help the buyer make an informed judgement on whether or not the property is a reasonable purchase at the agreed price. In some instances, the survey may even lead to the price of the house being reduced. If it shows that a significant amount of money is needed to rectify a defect in the property, the seller may be willing to cut the asking price by a similar amount. This has to be done before contracts are exchanged.
The building survey is more expensive because it provides a far more detailed account of the property's construction and condition. It can be carried out on all residential properties, but is recommended if a property is old, needs serious structural repair, has had extensive alterations or is of an unusual construction. A building survey will also be required if the buyer is planning a major renovation or conversion.
Defects in Detail
Usually it will take one or two days to complete the final report, which will include technical details of the property's construction, the materials used and all major and minor defects. Although the report does not typically contain a valuation, one can be arranged as an extra.
Friends who have made a recent property purchase will often know a suitable surveyor to carry out the work, or a recommendation can be gleaned from the mortgage lender or estate agent. Another option is to contact the Royal Institution of Chartered Surveyors, which has more than 80,000 members. Inform the chosen surveyor of any potential problems that were spotted when viewing the property. Also pass on any useful information about the locality, or about similar properties that are for sale or have recently sold in the area.