Research carried out by Chartered Surveyors (RICS) has revealed that over one in five people who buy a home without a proper survey will face expensive repair bills. The average cost of repairs is £5,750. Many buyers end up with a property which they can neither afford to repair, nor easily sell.
Buying a property is the most expensive purchase most of us will ever make. Some buy to let, or for investment, but for many, the property is intended to become their family home. Most buyers will base their decision to buy on a single viewing of a property. Such a viewing is unlikely to reveal many serious defects, and sellers may choose to hide the signs of these problems under carpets or behind furniture.
The average cost of a survey is small in comparison to the cost of a home. Although many buyers are aware of the benefits, over a third still opt to risk it, and go ahead without ordering a survey.
RICS Research suggests confusion among buyers
The RICS survey also indicated that 1 in 10 buyers think that estate agents act for the buyer, while nearly 1 in 5 think they act equally for the buyer and seller. Both these ideas are wrong; agents only act for sellers, and are not under any obligation to point out defects to buyers.
If a seller or his agent makes an untrue statement about the condition of the property, they could be guilty of misrepresentation. When a buyer only finds out about a defect after completion it will usually be too late to do anything except sue the seller or agent for damages. This is a time-consuming and expensive process which is often unsuccessful.
Surveys save thousands of pounds
The cost of a thorough, independent property survey is usually only a few hundred pounds. Repair bills can run into thousands. Crucially, even recently-built homes can suffer from significant defects. Homes less than ten years old may have the benefit of an NHBC or similar guarantee, but this does not guarantee that they are free of defects, only that some remedial costs will be covered by the builder.
If there is a defect on a NHBC-guaranteed property, the buyer will still have to face the disruption of both making a claim, and then the building work itself.
Do not rely on a mortgage survey
Mortgage surveys rarely more than a basic valuation, and may only be based on an cursory assessment of the property by a surveyor who has no knowledge of the area. They cannot be relied on as a guide to condition.
Renegotiate the price
If problems are discovered, the buyer should consider whether to negotiate on the price or just pull out altogether. Buyers often find that the cost of the survey is more than covered by the reduction in price.
A survey is also worthwhile when a purchaser is considering buying a dilapidated property cheaply, with the intention of renovating it. A survey will show the true condition of the building, informing an property investor’s decision to commit to the renovation, and revealing serious defects beyond their ability or resources to repair, or those which could make the property difficult to resell in future, such as structural issues, Japanese Knotweed, or infestation.