It is a rather sad indictment that, no matter what genuine and altruistic attempts are made to improve the way we do things, there will always be a trail of people whose sole concern is to find a way of making money for themselves out of the change.
This has certainly been the case with Home Reports, the reform of the process of buying and selling houses which was introduced successfully in Scotland in December 2008 and which is coming up for review next year.
After initial misgivings, the new system was embraced by the mainstream of the surveying profession and many selling agents, who now accept that Home Reports are working immeasurably better than anyone anticipated and that they have brought much needed stability to the market.
However, their introduction also saw the spawning of a plethora of previously unheard of companies offering “cheap Home Reports” and allegedly discounted deals. Newspapers have carried many stories about sellers who were tempted by these companies and who have lived to regret it.
The fact is that, like everything else in life, you get what you pay for. And one of the things you don’t get with these companies is a mortgage valuation, a vital bridge for realising successful sales by giving buyers and their lenders realistic information from a recognised and reputable source.
The mortgage valuation is the third leg of the service offered by professional companies, along with the single survey, and the energy performance certificate, which indicates how energy efficient the property is. In addition, there is the sellers’, property questionnaire, which forms an integral part of the Home Report.
“Cheap deal” companies argue that they are under no legal obligation to supply a mortgage valuation, since it is not mandatory within the Home Report. Often they are not on the approved panels for the majority of lenders, and whilst they are technically correct, reputable firms recognise the importance of the mortgage valuation for a buyer to get a mortgage on the property. This is therefore provided with the purchaser’s and seller’s best interest in mind.
Where there is no mortgage valuation, this often results in sellers having to commission another Home Report which does contain a mortgage valuation and in some cases has resulted in the loss of the sale of the property.
The reason that professional companies include mortgage valuations in the reports dates back to the consultation period before their introduction. At that stage, the lending industry approached the RICS and said that it needed a realistic and professionally assessed valuation so that it could make informed lending decisions.
Without that information, the lending institutions argued that a further report for lending purposes would be required. That argument holds good today and it is disingenuous at best for any firm to market home reports without it.
When a Home Report is properly carried out, everyone benefits. The buyer and the lender have a realistic idea of value and the seller can decide whether to carry out repairs to the property prior to marketing.
Without a valuation report, everyone loses – except, of course the company selling the inadequate product.
These are the key considerations that sellers should consider when choosing their surveyor:
Are they on lenders’ panels’ Lenders can refuse to accept reports. Reports by professional surveyors are trusted and accepted nationally by lenders, which can streamline and assist in the sale of a property.
Local knowledge. It is vitally important that your surveyor is experienced in his own area. Some firms send surveyors all over the country into areas where they have no idea of local market conditions.
Pricing. Cheap reports can be risky for something so crucial to the sale of your home. If the price is too good to be true there has to be a concern. Well-trained and resourced professionals come at a price.
Quality. Fully qualified surveyors have a wealth of experience in providing comprehensive reports that are trusted by all parties involved, adding value to the sale process.
Reliability. Mainstream firms have strong relationships with solicitors and estate
agents meaning they can be confident about experience, reliability and reputation.
Independence. It is vital that the surveyor remains independent of the seller and the buyer. If trust is to be nurtured the surveyor has to be free from outside influences when providing the Home Report.