Many people believe that when they get a mortgage to buy a house the survey fee that they pay their lender is for a full structural survey.
The survey carried out by the lender is only a valuation survey, to ensure that the amount of money being advanced is covered by the value of the house.
There are basically four different types of building survey:
The Valuation Survey
Which we have already mentioned is more for the protection of the lender, to make sure that they will get back the money that they advanced if the building is repossessed and sold.
This type of survey is relatively new, having been introduced only in 2011, and is designed to give a concise report on the condition of newer, conventionally built properties. A valuation is not included but if a mortgage is being obtained, that will be covered by the valuation report.
This survey is a little more expensive than the Condition Report but is a more in-depth survey. Not only does it cover the same details as the Condition report but also includes a valuation and an estimate of the rebuild costs. For additional peace of mind for buyers it also offers advice on defects and the necessity of repairs.
A Structural survey is the most comprehensive survey offered. If there are any concerns about the building you are buying, or if you are buying an older period property, this may be the better option. Included in the survey will be information on defects and the options to repair them. This is the most expensive survey but when the cost is compared with the value of the property and the possible defect that could be found in advance of your purchase it could be well worth the money.
A point worth mentioning is the rebuilding costs of a house. Many of us have it in our mind that the rebuilding of our house would have to be less than the value of the house. After all isn’t land the most expensive part of a houses cost? Actually no, the rebuilding cost has no real correlation between the value of the house and the rebuilding cost. BCIS (Building Costs Information Services), a collaboration between the ABI (Association of British Insurers) and the RICS (Royal Institution of Chartered Surveyors) has an online calculator to enable you to calculate the rebuilding costs of your house. You are required to complete a simple registration to access the information.
The calculator will only give accurate estimations of the rebuilding costs of your house if it is NOT;
- A house not built of brick
- A property with a basement, a cellar or more than two storeys
- A house with special design features
- A house other than of average quality
- A house of greater size than those described in the tables in the leaflet ‘ABI Buildings Insurance for the Home Owners’
- A house containing hazardous materials within their construction, e.g. asbestos
- A historic or listed building
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