If you are looking to purchase a property it is important to recognise that the valuation which is commissioned by the bank is for their purposes and not yours. The aim of the valuation is purely to ensure that the property will provide suitable security for the bank in the event that you default on the payments and they are forced to repossess it.
Many of the high street lenders have now operate a “managed panel” of valuers. When someone wishes to purchase a property they apply for a mortgage and the lender commissions a valuation for their purposes. In many cases the valuation will be automatically allocated to one of the surveyors on the bank’s panel. The purchaser may not be given the option to select their preferred valuer / surveyor and they are not necessarily provided with a copy of the valuation report.
A valuation for a lender provides a relatively basic description of the property. It does not give detailed information on the condition unless a particular defect has an impact on the value or saleability of the property.
As a purchaser it is important to recognise that a basic valuation is not a survey. It will not necessarily tell you everything that you need to know about a property that you are looking to purchase. Although you may have paid for the valuation as part of the mortgage application process the valuation is not for your benefit.
All of the high street lenders will give you the option to pay for a further report to be provided by their appointed surveyor which will be addressed to you, for your benefit. These will be survey reports from the suite of Home Surveys published by the Royal Institution of Chartered Surveyors (RICS). For the modest additional fee that you are asked to pay for these additional reports we feel that this is money well spent in order to establish the condition of the property and the requirement for future expenditure on repairs and maintenance.
A study undertaken by the RICS in the UK concluded that on average, people purchasing a property are faced with a repair bill of £5,750. A similar study has not been undertaken in Guernsey but taking into account the cost of construction and maintenance work here we expect the average costs to be significantly higher.
The RICS has produced this useful information paper which helps to explain the differences between a mortgage valuation for a lender and the more comprehensive surveys that are available.
BTP provide mortgage valuations, Homebuyer Reports and Building Surveys. If you are confused about the options available or need some advice to determine the appropriate survey for a particular property then please feel free to get in touch with us. We would be happy to speak with you, on a no-obligation basis.