Guide to choosing the right survey
What’s a survey I hear you ask? A survey is a professional report carried out by a Chartered Surveyor. It will help you as the buyer find out about the condition of the building and, if there are issues, give you a powerful tool for asking the seller to fix the problems before you move in or give you a reason for re-negotiating the price down. Having a report to show current or potential problems, is evidence that there may be big financial costs to you as soon as the property completes. Here at Edison Ford, we thought we could help our potential buyers and explain the different types of house survey and give approximate survey costs, to help you decide which option is right for you.
Types of Surveys
If you are using a mortgage to purchase a property, the mortgage lender will usually ask for a mortgage survey to be carried out to reassure them that the money they will be lending to you is an accurate representation of the property’s value and also that the property is what you say it is or has no issues (such as damp or structural issues). Surveys can also help you avoid a lot of expense and stress in the future, so it’s important you have an understanding of what each survey does for you.
Mortgage valuations aren’t surveys, although they are categorised as such. It’s essentially a report only intended to establish the current value of the property so far as the lender is concerned. It is not intended to check for faults which may need extensive repairs and it is not a guarantee that the property is in good condition.
The surveyor arrives at a value by comparing the property with similar ones, taking factors such as age, condition and location into account.
This valuation, realistically, is only for the benefit of the lender and unfortunately, is paid for from your own back pocket. The survey usually takes around half an hour and can cost anything from £100 and up to £500, depending on the size of the property. Sometimes lenders offer mortgages with free valuation surveys.
A Condition report is the most basic of surveys and is ideal for a modern house in visually good condition. It is good to give a buyer reassurance that their purchase is a sound investment though will only highlight significant problems but not give much detail on the issue or recommendations for rectifying.
Most commonly, there will be a traffic light rating indicating the severity of problems found. This is the ideal report if you feel confident with your experience and knowledge that there are no evident issues, but just need that little bit of reassurance.
The starting price of a Condition report is about £150
The Homebuyer’s report is the most widely used survey as it provides a more in-depth study of the condition of the property and will give you professional advice to allow you to make an informed decision of whether to go ahead with buying the property.
This survey will not include every single detail of the property, but it does highlight urgent matters that have a substantial effect on the value such as structural problems (subsidence, damp, etc), as well as any other issues inside and outside. This report will include all major sections of a property that are visible to the surveyor, so they will not lift up floors or carpet and wiring will not be included.
Condition ratings are used in a Homebuyer’s report to give you a summary of the action required.
- Condition Rating 1 – No repairs are needed
- Condition Rating 2 – Defects that need repairing or replacing but are not considered to be either serious or urgent.
- Condition Rating 3 – Defects that are serious and/or need to be repaired, replaced or investigated urgently.
The cost of a Homebuyer’s Report start from about £400.
The Building Survey is expensive and can cost in excess of £600, but it’s the most comprehensive survey you can get and will provide you with an extremely detailed understanding of the condition of a property. Including the depth the Homebuyer’s Report dives into, the Building Survey will also look beyond the floorboards, into the attic/cellar, above ceilings and behind walls. However, unless requested (likely at an additional cost), the Building Survey will not include a market valuation.
How can I get the most out of my survey?
- Make sure you choose the right survey from the outset – ask for references and examples from your lender/surveyor or check online to get an idea of what to expect from your survey – will the survey be useful in your situation? It’s important you choose a survey based on the condition of the property itself, not the cost of the survey. Money spent on a decent survey can save you a fortune in the future.
- Speak with family, friends or property professionals for advice before choosing a survey– remember, the average Brit will move house eight times over their lifetime, so don’t be afraid to ask those around you for advice and to learn from their experiences.
- Walk through the house with your surveyor – make sure you keep a close eye to make sure they don’t miss a thing! Check that they look at everything, behind furniture or peer out of windows
- Ask questions – point out things that worry you and ask about them, remember this will be your property so it’s important you have a good understanding.
What happens if a survey uncovers problems?
It’s not uncommon that a report finds issues, especially with older properties. If the survey uncovers problems then the lender will usually:
- Down value the property to match the repair costs
- Ask for a specialised report to be carried out (i.e. timber, damp, electrical, etc)
- Offer the mortgage on the basis of whatever fault highlighted is fixed
What are the most common problems?
The most common problems people will need to investigate after a survey include:
- Damp and timber issues
- Central heating system
- Electrical installation
- Structural problems
- Roof problems
What should I do when problems are discovered?
- Find out whether any problems, such as poor damp-proof course, are still covered by a guarantee
- Understand the cost of repairing any problems, keep in mind that the surveyor will usually price repairs at the worst case scenario. In other words, you will most likely get it done cheaper (of course depending on who you use)
- Get quotes (ideally minimum of 3) from reliable tradesmen
- Use these quotes to renegotiate the purchase price or ask the seller to fix the issues before you complete the sale
Remember, you can walk away from buying the property as you’re still not committed at this stage.
Looking for advice or a mortgage?
If you’d like some additional advice on mortgage surveys or would just like to discuss arranging a mortgage, then why not contact us for a free, informal discussion. Our mortgage specialists are experienced in finding solutions for our clients even if your requirements seem out of the ordinary or you have had a problem in obtaining a mortgage in the past.
We have over many years established unique relationships with lenders who will take a pragmatic and flexible approach to assisting you in obtaining the mortgage you require. Whether you want to borrow for a home, an investment property, a new commercial building or business project, we are here to help.