Understanding Property Surveys

A guide for homebuyers

by John C Hemsley BSc. FRICS

A home is likely to be one of the most expensive purchases you will make - so, it makes sense to get the information you need to make an informed and sensible offer on you future home. Both the Consumers' Association (publishers of Which? magazine) and the Council of Mortgage Lenders advise purchasers to get a survey before buying a property - don't just rely on a valuation.

So - what is the difference between a valuation and a survey?

A valuation is not a survey - it is a limited check carried out on behalf of a mortgage lender to spot anything that affects the security of a mortgage lender's loan. In essence, the mortgage lender wants to know if the property is worth at least the amount and terms of the mortgage offer.

Structural problems that are of no concern to a mortgage lender will not appear in a valuation report which is why purchasers should not rely on the information provided by a mortgage valuation when deciding whether or not to buy a property.

A property survey, on the other hand, is a kind of health check for you prospective purchase. If you intend to buy, have a survey done and carefully consider its results before entering into a contract. It could save you money as, depending on the seriousness of any structural problems highlighted in the survey report, it may be possible to re-negotiate the sale price to reflect the cost of any necessary repairs. The report may even help you to decide whether or not to buy the property at all!

Surveyors report on all parts of a property that they can easily get to - but they do not have to inspect areas the are difficult to access.

For instance they will not:

They may comment on the condition of wiring and water supply and they will use a ladder to inspect roofs up to three metres in height.

There are two main types of property survey:

The Homebuyer Survey and Valuation (HSV) is a service carried out to a standard format defined by The Royal Institute or Chartered Surveyors. It is primarily designed for conventional properties built in the last 150 years that are in reasonable condition.

An HSV is not a detailed survey of every aspect of the property and focuses only on the major and urgent matters. It is not suitable for many properties that are more than 150 year old, those in need of renovation of necessarily those where there is an intention to substantially alter or extend.

A Building Survey in a comprehensive inspection suitable for all properties but especially:

It is also a detailed examination of all accessible parts of the property and can be tailor-made to suit individual needs and concerns.

A building survey, however, does not include a valuation (although this can usually be provided in a separate valuation report for an additional fee).

Before commissioning a property survey, you should talk to your surveyor about which survey is right for your particular property and any specific information you would like included. For example, whether or not you can make any structural alterations.

Make sure you fully understand what is and is not automatically included in the survey. Read the terms and conditions carefully and check with your surveyor if you are unsure about anything.

Remember, you are paying for a survey and the cost will depend on the type, size and age of the property and the complexity of the survey.

Get professional advice by using a surveyor who is a member of The Royal Institution of Chartered Surveyors. This will give added peace of mind because:

Homebuyer Survey and Valuation		Building Survey
An HSV includes details of: The properties general condition Any major faults in accessible parts of the property that may affect its value Urgent and significant matters that need assessing before exchanging contracts including recommendations for any further specialist inspections The results of any testing of walls for dampness Comments on damage to timbers including woodworm and rot Comments on the existence and condition of damp proofing, insulation and drainage (although drains are not tested) The recommended costs of reconstructing a building in the event of damage (such as fire) for insurance purposes. This is not the same as the market value of the property The value of the property on the open market		A building survey includes details of: Major and minor faults The implications of any faults and the possible cost of repairs The results of any testing of walls for dampness Comment on damage to timbers including woodworm or rot Comments on the existence and condition of damp proofing, insulation and drainage (although drains are not tested) Information on the location Recommendations for any further specialist inspections

For more information about property surveys contact John C Hemsley BSc. FRICS. At

Pennicott Chartered Surveyors, 1 Peach Street, Wokingham, Berkshire. RG40 1XJ.

Tel. 0118 979 8118                         Fax. 0118 979 8228

Email: surveys@pennicott.com          Web:www.pennicott.com

 

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