For most people, buying a property is one of the single largest investments you’re likely to make. Whether you’re investing in property to rent out, or you’re buying a new home to live in yourself, it’s worth taking reasonable steps to protect your capital.
A building survey does this by verifying the condition of the property before you commit to a legally binding contract. There are different types of house survey, which go into different levels of detail, so it’s important to choose a survey you’re satisfied with and one that is appropriate for the type of property you are buying.
It’s worth noting that the process is very different in Scotland, where you should be provided with a Home Report (which includes a survey and valuation) by the seller, and any formal offer or ‘missive’ you make is legally binding.
This guide focuses on the process of buying a house in England, the different types of building surveys available, and particularly some of the issues that might arise when buying prime property in London and the South East.
There are several different types of building surveys, which typically vary in cost and level of detail. There are also numerous professional bodies providing accreditation to surveyors.
RICS (The Royal Institution of Chartered Surveyors) is probably the most reputable, but some surveyors are members of the Residential Property Surveyors Association (RPSA) instead.
The different organisations offer different types of house surveys, each with its own brand name. If you’re wondering “What house survey should I get?” let’s take a look at the options.
There are three main types of RICS property survey. It’s worth noting that if you need a market valuation survey of your property, you will need to choose RICS Home Survey Level 2 (With Valuation).
The most basic survey offered by RICS, including a surface-level visual inspection of the property and ‘traffic lights’ ratings of the building, grounds and services.
Note that a Level 1 RICS Home Survey does not test the services or the building fabric, and does not include a mortgage valuation survey.
A Level 2 RICS Home Survey goes into more detail, including a visual inspection of lofts/attics and cellars/basements if it is safe and easy to gain access.
There are actually two types of Level 2 Home Survey to choose from, with or without a valuation of the property, making this one way to obtain a RICS-accredited mortgage valuation survey.
The most in-depth option, a Level 3 RICS Home Survey is aimed at older properties, buildings that have been run-down or refurbished, and any property with significant alterations.
A surveyor will conduct a detailed visual inspection, including concealed areas that can be safely accessed, and will report (including cost estimates) any causes for concern or immediate repairs that are required – but not a market valuation of the property as a whole.
The RPSA offers four types of property survey, with a fifth option for corporate clients. Unlike RICS, the RPSA’s options include dedicated surveys for buy to let properties and new-build properties.
Aimed at modern, standard properties. Includes diagrams and photographs of any relevant features, along with colour-coded ratings of any issues identified.
Aimed at older, larger, more complex and/or higher-value properties. Identifies any defects, proposes rectifying actions and includes detailed descriptions.
A dedicated product for landlords when buying property to rent out. Includes a Home Condition Survey plus assessments of rental-specific health and safety concerns.
Designed for newly constructed properties. Impartial assessment of the quality of finish in regularly inhabited areas, to flag up incomplete works or unacceptable cosmetic damage.
A ‘critical defects’ summary for high-volume buyers and portfolio investors, offering rapid turnaround with reliable quality.
If you buy a property with a mortgage, your lender will normally send a chartered valuation surveyor to confirm that the property is worth at least as much as you have asked to borrow. This is commonly referred to as a bank valuation survey, but it’s not the same as a buyer survey.
A bank valuation surveyor is not there on your behalf; they are there to protect your lender’s financial interests. All they are really interested in is ensuring that if you do not meet your mortgage repayments, the lender will be able to recoup their losses by repossessing and selling the property.
This is why a bank valuation, estate agent valuation and surveyor valuation will often differ significantly:
Many buyers make the mistake of thinking that the lender’s mortgage valuation survey is equivalent to a basic buyer survey. As noted above, this is not the case – you usually will not get a detailed copy of the lender’s survey report and may not be aware of hidden problems with the property.
A survey on new-build properties is a good idea; in fact, the RPSA New-Build Snagging Survey is “a must for any newly constructed home” according to the association.
New-build properties are, by definition, newly built – so you might be asking “Do I need a survey on a new-build?” Although the property should not suffer from the wear and tear of historic buildings, it may have significant snagging defects that affect the aesthetics, or even the safety of the property for children and other occupants.
Because of all of this, the answer to “Should I get a survey on a new-build property?” is a resounding yes. The final decision is entirely your own, but buying a new-build property is just as much of an investment risk as buying a period home, so it’s certainly worth considering.
In general, if you find yourself wondering “Should I get a building survey?” it’s often an indication that you should. Don’t rely on mortgage valuation surveys carried out on behalf of your mortgage provider, or valuation surveys by the estate agent.
By appointing a chartered valuation surveyor you gain peace of mind about the market value of the property and/or its physical condition. For prime properties including high-value homes for sale in Central London, it’s often sensible to get a higher level of survey carried out.
At best, you gain confidence that the property is everything it appears to be. At worst, you get valuable insight into any required repair work and how much it will cost – or enough of a reason to withdraw your offer and continue your property search elsewhere.
To discuss any of the issues raised in this Buyers’ Guide or to embark on a new property search via Black Brick’s Property Buying Service, contact us today.
We would be delighted to hear from you to discuss your own property requirements. For a non-obligatory consultation, please contact us.