The residential property survey is a crucial part of the home buying process, as it will identify issues with a property that could turn out to be very expensive to fix after the sale has gone through.
However, despite the important role that the survey has to play in ensuring that the potential property purchase is what the homebuyer thinks it is, evidence suggests that few people actually go ahead and order the survey.
Research by the government working group MORI shows that there is an enormous gap between the number of homebuyers who claimed they would commission a survey and the number that actually do.
The survey identified a huge 80% of homebuyers indicating that they would order a residential property survey before the purchase process began, but only 18% actually doing so.
There are numerous reasons why some buyers might choose not to go ahead, including the cost – which can often be significantly more than buyers were expecting – as well as the fact that many buyers will assume that the lender’s valuation acts as a survey of the property, which is in fact not the case.
Many of those who did not obtain a survey were no doubt relying on the assumption that ‘it won’t happen to me.’
But research by the consumer group Which? in 2008 established that from their test group of home buyers that did not opt to have a survey of their property done, one in four ended up having to spend more than £2,500 on the newly purchased property to correct serious issues that would have been uncovered in a home condition report.
Even worse, for a very unlucky one in ten home buyers who did not commission the survey, the cost of fixing the problems that the survey would have uncovered was over £10,000.
Clearly, where a survey uncovers issues before the sale has been agreed there is still a process to go through in order to ensure that the issues are fixed, or that the sale price reflects those that are outstanding. However, the Which? research found that for those homebuyers who did arrange a property survey where issues were uncovered, those buyers were able to negotiate a reduction in the price of the property to account for the problems, averaging around £2,000.
Perhaps one of the reasons that homebuyers don’t arrange a survey when they should is that few people are aware of the options out there.
According to the Council of Mortgage Lenders the responsibility for educating homebuyers as to the survey options should lie with conveyancers. This is why the Residential Property Surveyors Association has recommended that certain options be included in the introductory letter of engagement that you will sign before the conveyancing process gets under way.
These options are:
‘I will arrange my own survey (I understand that my lender’s valuation is not a survey);
Please arrange a survey for me;
I do not want a survey.’
While this is not a legal requirement, and places no actionable burden on conveyancers, it does ensure the survey is on a homebuyer’s radar – and that your conveyancer can arrange it for you if you want them to – as well as clarifying that it is an entirely different animal from the lenders’ valuation survey.
If you have any questions about property surveys – or residential conveyancing in general - feel free to contact our award-winning conveyancing team.