Any self-respecting homebuyer conducts site visits and inspections before purchasing a property. The mandatory mortgage valuation report is a step in the right direction, but this is only a brief overview of what might affect the value of the property. What it isn’t is a more comprehensive survey, such as the one offered by the Royal Institute of Chartered Surveyors (RICS). The RICS Homebuyer Report can help prospective homeowners and investors make informed decisions — whether this entails renegotiating the selling price, or passing on a deal completely.
What a RICS Homebuyer Report tells you:
A RICS Homebuyer Report is a level 2 property survey and is the most popular kind for homebuyers. Compared to the level 1 survey, it offers a more in-depth look into the state of the property, revealing necessary fixes that must be made. In the UK, a Money Guru survey reveals the top five household repairs: windows, kitchen, bathroom, boiler, and roof. All of these can be costly, but manageable (or, if needed, avoidable) with the right property survey.
The report also shows whether a home is dealing with bigger issues, most of which might not be noticeable at first glance. Property Division identifies some of the more hidden defects that this type of report can uncover, like timber decay, mould, damp, and leaks, which should all raise red flags in home buying.
What it doesn’t tell you:
However, there are some limitations to the RICS Homebuyer Report. This type of survey is non-invasive, which means surveyors only check what’s visible and easily accessible. Drilling of any kind or ripping up floorboards is not part of this survey to avoid risk of causing any damage to the property, but it means that the survey might not detect other home problems.
While this survey is usually enough, most homebuyers might want more specialised surveys after this initial report. For instance, those worried about the state of a home’s central heating systems will not be able to learn much about it, as level 2 home surveyors do not check the condition of the inside of any chimney, boiler, or other flues. If you are buying a home, try asking the owners when the heating and water systems were installed or if they can provide certificates, warranties, or previous insurance plans. HomeServe highlights how good coverage plans usually come with 12-month warranties, as well as including replacement parts, an efficient helpline, and quality guarantees. This way, your prospective home is protected against expensive emergency repair costs down the line and you don’t have to worry about annual service costs. Otherwise, it might be good to get a separate central heating system survey. The same goes for other areas you might want to get looked at, such as the structural foundation or the electrical installations.
Who needs it and who doesn’t:
The RICS Homebuyer Report is ideal for properties in reasonable condition, particularly those that were built in the last 100 years and didn’t undergo major renovations. If you’re purchasing a home that’s fairly new or in a building that’s not more than 30 years old, a level 1 report might suffice. If, however, you’re looking at older properties or those that were altered significantly, a level 3 RICS Building Survey is highly recommended. This is an even more extensive report covering the projected cost and timeline of repairs, which is ideal if you want to remodel or add extensions.
What to do with the results:
Mortgage adviser David Blake describes these reports as a bargaining chip, and a powerful one at that. A survey of 1,800 homebuyers revealed that 43% were able to renegotiate to a lower house price, while 24% successfully requested repairs using the results of the report before the final purchase. Of course, it’s a good sign when a survey doesn’t reveal any causes for concern, and prospective homeowners can sleep easy knowing they’re making the right choice. Otherwise, you can use the bad results to renegotiate terms or make the decision to back out of a purchase before signing on the dotted line.