Property Tips by Chartered Surveyors  from the Haynes House Manual series

 

 

Thinking of taking on a renovation project?

 

Finding the right property to buy for a successful renovation project can be a risky business.

There’s plenty of advice from TV property gurus on things like décor and picking the right location. But when it comes to accurately assessing the condition of a building you’re pretty much on your own.

Get this wrong and you could end up lumbered with a hopeless money-pit that bleeds you dry with ruinously expensive underpinning or major roofing works.

Professional developers are wise to the fact that profitability depends on devoting as little of their budget as possible to repairing hidden parts of the building, such as the structure and drainage system. Instead, by lavishing money on stylish kitchens and bathrooms, profitability can be boosted with visible benefits that immediately appeal to buyers.

Buying a renovation project blind can lead to financial disaster. So it’s essential to get an accurate assessment of a building’s condition before you buy. Instructing a survey should also provide peace of mind further down the line by pre-empting any nasty hidden surprises that could scare buyers away when you later come to sell your freshly renovated property.

But it’s not just big ticket repairs you need to worry about – rectifying large numbers of smaller defects can be surprisingly costly.

 

Spotting defects

RICS Home Survey reports have come along way in recent years with the introduction of user-friendly red/amber/green ’traffic light’ condition ratings and the culling of excessive jargon. But the fact remains that careless deployment of killer words, such as ‘asbestos’, ‘beetle infestation’, ‘rising damp’,’ radon’, ‘fungal decay’ and ‘subsidence’ can unwittingly frighten the pants off all but the most determined buyers.

However, an experienced surveyor should know how to moderate their language with selective use of vocabulary.

 As well as highlighting any significant problems a good survey should also provide reassurance, explaining where apparently worrying defects are actually quite ‘normal’ for the type of property, and how to avoid ‘overkill’. In fact, there are many issues that commonly arise in surveys that needn’t  deter prospective renovators, and may not actually cost that much to rectify.

And presenting the vendor with a list of defects noted in the report could come in useful to help justify re-negotiation of the purchase price.

 

Which survey?

Before assessing the different types of survey, there is one myth that needs to be nailed straight away. Mortgage lenders have an unfortunate habit of referring to their valuation inspections as ‘surveys’.

This can sometimes lure unsuspecting applicants into a false sense of security, believing that their copy of the mortgage valuation report (typically only a single page) is some sort of de facto warranty that the property they’re buying has a clean bill of health. In fact, the point of a mortgage valuation is simply to provide the lender with the confidence that should the worst-case scenario occur – default and repossession – they should be able to get their money back (although the stated market valuation figures are only accurate to within a 5% margin of error).

As far as describing the building’s condition is concerned, mortgage valuation reports generally resort to broad ‘catch all’ phrases such as ‘The general condition of the property appears consistent with its age and type of construction, but some elements of the property are ageing and likely to require attention’ – which tells you next to nothing.

When it comes to commissioning a ‘proper’ survey, there are 2 main options: a Level 2 Home Buyer Report, or a Level 3 Building Survey. Both can only be carried out by qualified members of the RICS (Royal Institution of Chartered Surveyors) either MRICS or FRICS (‘Members’ or ‘Fellows’ – there’s little practical difference).

A better option in cases where a property is clearly suffering from pronounced cracking or structural movement can be to directly commission a structural engineer’s report in the first instance.

Level 1 ‘Home Condition Reports’ are a more recent arrival on the scene. These are primarily aimed at prospective vendors looking for an independent assessment of their property prior to putting it on the market, similar to the Scottish ‘Home Report’. Pitched at a budget price, these assess the general condition of the main components of the property and should identify significant defects. You can see Level 1 Home Survey prices for your local area and house type here.

But unlike HomeBuyer and Building Surveys they don’t contain repair advice; they also exclude market valuations and insurance reinstatement costs.

 

 

The Four Main Risks to Buildings

Regardless of the type of survey, there are 4 main risks to buildings which the surveyor will need to consider:-

 

• Poor original build quality (‘inherent defects’)
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• Lack of maintenance
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• Alterations, botches and ‘DIY disasters’ (including any necessary consents)
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• Threats from the outdoor environment (eg flooding and invasive trees or shrubs)

It’s not always appreciated that as a client instructing a survey you are entitled to raise any matters in advance that you’d like the surveyor to pay special attention to, for example whether in their professional opinion the loft would be suitable for conversion. But where there are a number of specific concerns that you want to raise, particularly design matters, it would be better to opt for a more extensive Building Survey. Some chartered surveyors can also provide architectural design services.

 

RICS Level 2 Home Survey – ‘HomeBuyer Report’

This is the most popular type of survey, suitable for the vast majority of homes built since the late Victorian period. Prices vary according to age, location and market value, but for an average 3 bed semi the typically cost might be around £500.

You can check Level 2 Home Survey prices for your local area and house type here.

The inspection covers the whole property inside and out, from the loft down to the drains (where accessible) and is written on a specially designed RICS report, typically about 10 to 12 pages long. Each part of the building is described and any significant defects explained, with a simple ‘traffic light’ summary and an easy-to-understand ‘Condition Rating’  of 1, 2 or 3.

A HomeBuyer Report (HBR) should highlight all significant defects – in fact anything that could materially affect the value. It should explain causes and suggest solutions, and also alert you to future maintenance problems. The report includes a valuation and insurance calculation.

 

RICS Level 3 Home Survey – ‘Building Survey’

Formerly known as ‘Full Structural Surveys’, these provide a detailed description of a building’s construction and condition. Prices are typically around twice that of the equivalent HomeBuyer survey. Ideal for period properties, buildings that you want convert, or those that have already been extensively altered. You can see Level 3 Home Survey prices for your local area and house type here.

Building Surveys allow the surveyor to express extensive advice and are typically at least 20 pages long. Essential for properties older than about 1880, thatched cottages, rambling mansions, or properties in need of extensive renovation, and for buildings of non-conventional construction. As well as covering all urgent and significant defects, a Building Survey will report on less serious issues. A valuation is not normally included unless requested.

 

 

 

See Rightsurvey.co.uk for a quick guide to valuation and survey prices

 

Check out our other posts for more info that will help you pay the right price for the right property.

 

We would always recommend using RICS certified surveyors in every instance – don’t get caught out, get instant quotes for RICS surveyors here.

 

                                                              

 Ian Rock’s Rightsurvey property tips are taken from the Haynes House Manual series.