How to deal with a bad house survey

The process of acquiring a property can be both thrilling and nerve-wracking, filled with decisions that will impact your life for years to come. One critical part of this that shouldn’t be overlooked is the homebuyer’s survey. This blog post explains what a homebuyer’s survey is, what it does, the different levels and costs, and what can be done if it finds problems in the purchase property.

Understanding the homebuyer’s survey

A homebuyer’s survey is a comprehensive inspection of a property’s condition and is conducted by a qualified surveyor. Its purpose is to identify potential issues that may not be immediately apparent during a standard viewing. 

Firstly, it provides buyers with a clear understanding of the property’s condition, helping them make informed decisions about their purchase. It can uncover hidden defects, structural issues and potential maintenance concerns that might not be obvious to the untrained eye. Armed with this information, buyers can negotiate a fair price based on the property’s true condition.

Secondly, a homebuyer’s survey can save the buyer money in the long run. Identifying potential issues early on lets buyers factor in the cost of necessary repairs or renovations before they finalise the deal.

What to look for in a homebuyer’s survey

When commissioning a Homebuyer’s Survey, there are a few key aspects to pay attention to:

1. Structural integrity: Make sure the survey includes a thorough examination of the property’s structure, including the foundation, walls and roof.
2. Damp and rot: Look for signs of dampness and rot, which can lead to long-term damage and affect the overall liveability of the property.
3. Pest infestations: Check whether the survey includes an assessment for pest infestations, as these can be a common and often hidden issue.
4. Electrical and plumbing systems: Ensure that the survey covers the condition of the property’s electrical and plumbing systems, identifying any potential hazards or areas in need of improvement.
5. Energy efficiency: Getting a survey that includes an energy efficiency assessment provides valuable insights into the property’s insulation, heating and overall energy consumption.

What is a house survey?

A house survey, also known as a property inspection or building survey, involves an examination of a property, both inside and out. The surveyor evaluates the structural integrity, condition of the building materials and the presence of any defects or potential problems. 

There are several types of home surveys available to property buyers, each offering varying levels of detail and coverage:

RICS Condition (Level 1) Report

The RICS Condition Report, also known as a level 1 report, is the most basic survey option, providing a snapshot overview of the property’s condition. It focuses on identifying any immediate and serious issues that require attention.

While this survey may not delve into great detail, it is a cost-effective option for relatively new properties or those in generally good condition. It is particularly suitable for buyers who are confident in their ability to address minor issues independently.

RICS Homebuyer (Level 2) Report

For a more in-depth analysis, many homebuyers opt for the RICS Homebuyer Report, also known as a level 2 report. This survey strikes a balance between the concise nature of the Condition Report and the comprehensive detail of the Building Survey.

It includes a thorough examination of the property’s visible and accessible elements, highlighting potential problems and providing advice on necessary repairs. The Homebuyer Report is suitable for properties of conventional construction and in reasonable condition, making it a popular choice for many buyers.

RICS Building Survey (Level 3 Report)

The RICS Building Survey, also known as a level 3 report, is the most comprehensive and detailed option, making it suitable for older properties, unique structures, or those that need significant renovation. This survey goes beyond the scope of the Homebuyer Report, offering an in-depth analysis of the property’s structure, fabric and condition.

It’s valuable for buyers who are considering a property with known issues, such as listed buildings or those with a history of structural problems.

When deciding which survey option to choose, you should consider the age and type of the property, your budget, and your tolerance for potential issues. While the more detailed surveys come with a higher price tag, they can save you money in the long run by uncovering potential problems early on. On the other hand, if you’re purchasing a relatively new property and aren’t anticipating significant issues, a more basic survey may be sufficient.

How much do house surveys cost?

Knowing the guide prices for each type of Homebuyer’s Survey will help with your budgeting. While these prices will vary based on a few different factors, including property size, location and the level of detail required, having a general idea can help you plan.

Cost of a RICS Condition Report

Typically the most affordable option, the RICS Condition Report may range from £400 to £600. This makes it an attractive choice for budget-conscious buyers who still want headline insights into the property’s condition.

Cost of a RICS Homebuyer Report Cost

With a more detailed examination, the RICS Homebuyer Report usually falls within the range of £500 to £900. While a slightly higher investment, it offers a comprehensive overview suitable for many property types.

Cost of a RICS Building Survey Cost

As the most detailed option, the RICS Building Survey can range from £700 to £1,200 or more. While it represents a higher upfront cost, it provides the most detail, which is particularly advantageous for older or more complex properties.

Choosing a surveyor for your homebuyer’s survey

The surveyor’s expertise and attention to detail can significantly impact the quality of the information you receive about your potential new home, so bear the following in mind when choosing who should conduct your survey:

1. Professional qualifications: Make sure the surveyor is a qualified and accredited professional – you can look for designations such as RICS (Royal Institution of Chartered Surveyors) or CIOB (Chartered Institute of Building). RICS also offers an online surveyor finder for your next home survey based on location and level of homebuyer’s survey. 
2. Experience and specialisation: Consider the surveyor’s experience, especially in relation to the type of property you’re buying. Some surveyors may specialise in specific types of properties, like historic buildings or commercial spaces. Choosing a surveyor with expertise relevant to your property type will give you a more thorough and accurate assessment.
3. Local knowledge: Opt for a surveyor with local knowledge of the property’s area. Local expertise can provide valuable insights into regional factors that may impact the property’s condition, such as flooding or problem flora.
4. Insurance and professional indemnity: Make sure that the surveyor holds professional indemnity insurance, as this protects you in case of errors or omissions in the survey report. 
5. Client reviews and testimonials: While not essential, it’s a good idea to check out the surveyor’s reputation by looking at client reviews and testimonials. Online review sites and personal accounts from friends and family can give you an idea about the surveyor’s communication skills, reliability and overall satisfaction of past clients.
6. Cost transparency: Request a clear breakdown of the surveyor’s fees, any additional costs associated with the survey, and what you’re getting in exchange for your money. 
7. Turnaround time: Ask about the expected turnaround time for the survey report. This is particularly important if you’re working to a tight turnaround with the property.

What if the house survey finds issues?

There are lots of different factors that may cause red flags to come back on a house survey. Some of these will have a greater impact and require more attention than others.

• Structural problems include cracks in walls, floors, or foundations, structural movement or instability, or issues with load-bearing walls or supports.
• Dampness and water damage including leaks in the roof or the plumbing, water stains, mould or mildew.
• Electrical issues such as outdated or unsafe electrical wiring, inadequate electrical capacity or faulty outlets.
• Plumbing problems like leaking pipes or fixtures, poor water pressure or drainage, or sewer line issues or backups.
• Pest infestations including evidence of active rodents, insects or other pests, or damage caused by these pests to wood, insulation, or other materials.
• Safety concerns such as the presence of hazardous materials like asbestos, lead paint or mould, a lack of proper fire safety measures, or unsafe balconies or railings.
• Poor insulation or energy efficiency, such as draughts or air leaks, inefficient heating systems or inadequate insulation.
• Environmental factors like proximity to environmental hazards such as flood zones, landfills, industrial sites, soil contamination or unstable ground conditions.
• Legal or compliance issues including property line disputes or encroachments, unpermitted additions or conversions, or property easements.
• General wear and tear like signs of neglect, deferred maintenance or ageing infrastructure.

What is a zero house valuation?

A zero house valuation, also known as a cash value valuation, happens when the surveyor concludes that the property isn’t mortgageable and it will only appeal to cash buyers. It doesn’t mean the property has no value – the ‘zero’ refers to what someone is willing to lend, not to what someone is willing to pay.

What is a down valuation?

A down valuation occurs when the mortgage lender’s surveyor values the property below the agreed selling price. This can cause trouble as there’s now a gap between the price the buyer and seller have agreed upon, and the amount of money available to the buyer. This may cause the buyer to rethink their offer or pull out completely. 

There are options if you get down-valued, such as:

• Lowering the asking price.
• Spending money to validate the existing asking price.
• Finding a new buyer with a different lender.
• Finding a new buyer who doesn’t need a lender.

How to deal with a bad house survey

For the buyer

Buyers should carefully review the survey findings and clarify any areas of concern, either with the surveyor directly or with their solicitor. When the buyer feels comfortable with the implications of the report, they should then consider whether the problems are enough to stop with the purchase, or if negotiations can be made. When deciding this, they should consider the cost of repairs, the property’s value post-repair and any associated risks.

Armed with the survey findings, the buyer can negotiate with the seller to address the property issues. This may be in the form of requesting repairs be completed before the sale closes or negotiating a reduction in the purchase price to account for the cost of future repairs. Buyers should seek advice from qualified professionals (contractors or structural engineers) to assess the extent of the issues and provide estimates of repair costs.

For the seller

While the seller typically won’t receive the survey report (as it is a Homebuyers Survey), they will hear about any issues found as a result. When the seller has fully understood the implications of the report, they should begin assessing each issue’s severity and creating a list of priorities, i.e. structural problems and water damage should take priority over general wear and tear issues. 

Sometimes the seller may come to an agreement, through their solicitors, to leave certain pain points to the buyer. This typically means the buyer can negotiate a lower price on the property, as they will have the cost and hassle of undertaking certain repair work when they take ownership. It’s important the seller bear this in mind before deciding to give the option to the buyer, as it often represents a financial loss.

If the seller has any professionals in to complete repair work, the seller should keep all the documents (e.g. invoices and details of work carried out) from the workers, so that they can share them with the buyer. This helps reassure buyers and provides evidence of the property’s improved condition.

How can House Buyer Bureau help?

While a bad survey, a zero house valuation, or a down valuation, can narrow the buyer pool, there are still options in selling your home and not collapsing the chain. We at House Buyer Bureau are cash buyers and we specialise in buying properties quickly – in as little as 7 days, or to a longer timescale if you need. 

Homebuyer survey FAQs

Why do I need a house survey when buying a house?

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The survey helps identify hidden issues and potential repair costs, which allows you to negotiate a fair price with the seller. While there isn’t a legal requirement to have a survey done when buying a house, it’s strongly recommended. Without a survey, you may miss important information that could impact your decision-making process – i.e. how much you’re willing to pay for the property and even if you still want to buy it.

How long does a homebuyers survey take?

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A standard Homebuyer’s Survey usually takes a few hours to complete; the surveyor will conduct a thorough inspection of the property, both inside and outside, examining its structural integrity, systems, and overall condition.

Following the inspection, the surveyor will compile a detailed report with their findings. The entire process, from inspection to report delivery, typically takes around 5 to 7 days.