House Surveys – What Are They and Why Do You Need Them?

Posted 22 January 2018 by Nick Parkhouse

Our essential guide to house surveys explains the types of valuation available, survey costs and why you need one...

Your home is likely to be the biggest investment you ever make. So, when buying a house, it’s important that you get a professional to inspect the condition of the property.

But what types of survey are available? How much do valuations cost? And how does a survey affect your mortgage? Keep reading for answers to these questions and more.

What is a house survey?

A house survey involves a qualified professional inspecting the condition of a property. The surveyor will provide expert commentary on the property, give a current valuation, and identify any significant problems or repairs that are needed.

What types of survey are available?

There are four main types of survey that are available.

1. Mortgage valuation

A mortgage valuation is not a full property survey. It is carried out by a lender to confirm that your property is worth the amount you are paying for it, so they can agree the mortgage you require.

It doesn’t tell you anything about the condition of the property, or whether there are any repairs or alterations that are needed.

2. A condition report

This will be carried out by a Royal Institution of Chartered Surveyors (RICS) qualified surveyor and is the most basic survey that you can get.

It will give you an idea of the condition of the property using a ‘traffic light’ structure but doesn’t go into any detail.

3. A HomeBuyer’s report

A HomeBuyer’s report is more detailed than a condition report and will provide advice on any issues affecting the property. It will focus on what the surveyor can actually see – for example the surveyor won’t look under floorboards or behind large items of furniture.

It will highlight issues such as:

  • Damage to timbers including rot or woodworm
  • Damp
  • Urgent problems that need specialist inspection
  • Major faults that might affect the value of the property

It will also provide a current valuation of the property and the estimated rebuilding cost.

4. A building survey

A building survey is the most thorough survey available. The surveyor will carry out a full assessment of the property and provide both an analysis of the current condition and advice on any repairs and maintenance that are needed.

They will also give you an idea of the potential cost of repairs and recommendations and any specialist inspections that are needed.

How much does a house survey cost?

The cost of a survey is generally determined by:

  • Which type of survey you want
  • The purchase price/estimated value of the property.

Costs start at around £250 for a basic condition report. A HomeBuyer’s report typically starts at around £400 while a RICS Building Survey generally starts at around £500.

Do I need a survey?

Your home is likely to be your biggest investment. While the cost or a survey can seem like a big expense at a time when you need to look after your money, it will help you make an informed decision about whether you want to proceed with the purchase and whether you’re prepared to pay the asking price.

The survey can also help you to negotiate with the seller. For example, if the surveyor identifies that there are £5,000 worth of repairs needed to the property, you may be able to reduce the asking price by this amount.

It is up to you which type of survey you choose, and you should generally pay for the most comprehensive survey that you can afford. If you’re buying an older property then it is often a good idea to pay for a more detailed survey, as there are likely to be more potential issues.

If you are buying a new property, then a basic survey may be all that you require.

How does a survey affect my mortgage?

Your lender will need to see a valuation of the property before they agree your mortgage.

On a very basic level, the lender needs to know that the property is worth what you are paying before they agree your mortgage.

If the surveyor highlights essential repairs, or they value the property at less than you are paying for it, it can affect the amount the lender is prepared to advance.

A surveyor’s report will often find some issues, especially if you are buying an older property. The most common issues that a survey raises are:

  • Problems with the roof
  • Electrical or wiring issues
  • Problems with the central heating system
  • Damp and timber issues
  • Structural issues that require specialist advice

If any of these problems are identified, you can try and establish whether there is a guarantee in place, for example for a damp-proof course or an electrical guarantee. The surveyor should be able to give you an idea of how much it will cost to repair any problems, or can put you in touch with a specialist who will give you a quote.

If the surveyor does highlight problems or down values the property, you can:

  • Challenge the valuation by providing evidence of similar properties that have sold for the same price
  • Insist the vendor carries out any essential repairs before you complete the purchase
  • Reduce your offer price to take into account the down valuation or the cost of repairs.

Always remember that you are not committed at this stage, and so you can walk away from the transaction if the cost of repairs is likely to be too high. You can also pull out of the transaction if the vendor is not prepared to reduce the price based on the survey.

 

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