You’ve finally made a decision to purchase that dream property, and the bank valuation has come back, and they’ve said “Yes”.
However, wait. What does that bank valuation mean?
Well, that’s how much the bank is willing to lend on your dream property, that’s all!
So, what are they not telling you, and what do you need to know?
Well, there are three things that the bank doesn’t inform you when they say, Yes we’ll lend you the money;
1. The valuation is not for your benefit. It’s for the bank.
2. The assessment will not highlight building faults or defects.
3. Home surveys can save you thousands on repairs and help you negotiate the property’s price if you wish to do so.
What’s a valuation
There’s a difference between a valuation and an RICS property survey, and many people are not aware of the difference.
The valuation aims to assess if a property is worth the agreed sale price before the lender approves your mortgage. As a result, the report may note obvious problems affecting the property’s value. Still, it won’t give you a complete picture of its condition.
Your future home is likely to be the most expensive purchase you’ll ever make, so getting a survey done is essential to protect it. Depending on the type of property you buy, different types of home surveys are available.
Home Survey Level 1 (The Condition Report)
The condition report provides an independent assessment of the property’s condition but does not include a valuation. Instead, it follows a standard format and uses a simple traffic light system to flag any issues that need urgent attention. The condition report is recommended for properties in good condition and less than 20 years old.
Home Survey Level 2 (Homebuyers Survey)
The Homebuyer Survey now called the Level 2 Home Survey, is suitable for homes of a traditional type and construction and in reasonable condition. With colour-coded condition ratings and comments on defects, plus advice on repairs needed, the Homebuyer Report can indicate the property’s issues and a valuation.
The Building survey includes the fabric and condition of the property and defects, repairs and maintenance advice. We recommend a Building Survey for properties that have been significantly altered, needs renovation, or have unusual construction.
The Property Valuation provides property value information to your mortgage provider. Whereas the RICS Property Survey is there to provide specific property information. The report includes legal issues, maintenance, and items of disrepair. As a result, you can make an informed decision on the purchase of your desired property.
I started the Shape Surveyors in 2011 after changing careers. As an ordinary house purchaser, I mistakenly believed that the Valuation was a survey and went ahead and purchased my first property. This old Victorian house was presented in excellent condition, totally refurbished. I fell in love with the place, ready to make it my home. However, three months later, dampness, movement and rot were uncovered. Several builders inspected the property, and the recommendation was to strip the house back and start again. It needed a rewire, damp proof course, treatment for dry rot and timber infestation. The news was devastating. The minimum quote was £27,000. I had just put all of my savings into this purchase and did not have enough money to renovate the property.
I started researching. In those days, I did not know anyone who had a survey, let alone a surveyor. The Homebuyer Report would have highlighted all of these defects and allowed me to negotiate the price. So I decided to go back to university to become an RICS Surveyor. I did not want this to happen to me or anyone else again. So, after years of training and experience in housebuilding, project management, and residential surveying, I decided to provide a comprehensive service to homebuyers.
I’m on a mission to keep you informed throughout the home buying process, from viewing the property to closing that critical sale, whether you’re a first-time purchaser, upsizer, downsizer or investor. Unfortunately, property defects are often hidden.