Not sure the best way to discover the true condition of your dream property? Then read on as we explain the difference between a valuation and a survey and why the latter is beneficial.
If you’re buying a property for the first time, the checklist of things to do can be confusing (and expensive). You might wonder, if you’re having a valuation done on the property, do you really need to pay for a survey, too? Aren’t they the same thing?
The short answer is: no. Here are the key differences you need to understand, plus why paying for a survey is important in almost all circumstances…
What is a valuation?
The purpose of a valuation is to satisfy your mortgage lender that the property you wish to buy is worth the money you plan to spend on it. It’s purely for your lender’s benefit, so they can be confident it’s a good investment. Put simply, you need to get a valuation in order for the lender to agree to give you the money to buy it.
A valuation doesn’t have any benefit for you, beyond being a necessity for your mortgage to be agreed. It involves only a superficial inspection of the property and won’t highlight any potential costly issues, such as damp, dry rot or anything that’s not in line with current building regulations. In fact, some mortgage lenders even carry out ‘desktop’ valuations remotely, only using information about the property that’s available online, such as via HM Land Registry.
What is a survey?
In contrast to a valuation, a survey is for your benefit. It will be carried out by a qualified surveyor, to provide you with an independent account of the property’s condition. A survey will point out any hidden problems with the property that you otherwise might not spot, such as damp, subsidence, faulty electrics or drainage issues.
There are three main types of survey to choose from, depending on how in-depth you want it to be:
Level 1 Survey (previously known as a Condition Report)
This is simply a brief assessment of the property’s condition, giving you a concise overview of its condition.
Cost: from £300
Level 2 Survey (previously known as a HomeBuyer Report)
A surveyor will perform a visual inspection of all easy-to-access areas of the property and will look for problems that are relatively self-evident. However, the surveyor will not delve into the structural integrity of the building.
Cost: around £300 to £1,000
Level 3 Survey (previously known as a Full Building Survey)
The most comprehensive survey available, this will offer a full assessment of the structure and condition of the property, including a breakdown of related costs to fix issues that are discovered.
Cost: around £650 to £1,500
Which survey should you opt for?
It’s always a good idea to pay for a survey, because the valuation is purely for your lender’s benefit and therefore won’t highlight any potential pitfalls with the property. While forking out for a survey can seem like a big expenditure, it could save you a ton of hassle if it stops you buying a property that turns out to have extensive hidden structural issues. And, on the flip side, a survey will give you peace of mind if nothing untoward shows up.
When it comes to the level of survey to opt for, a Level 1 survey is generally only recommended if the property has been built recently, as new homes generally come with a ten-year warranty.
If you’re buying an older property (for example, a period property) that may need repairs, or you’re planning to do considerable work to it (for example, an extension), a Level 2 or 3 survey is important.
Is a survey always necessary?
If the home you want to purchase is brand new, a valuation alone may suffice. In this instance, you could also opt for a ‘snagging survey’. A snagging survey is unique to new homes and is a good idea because, even though the home is newly built, problems can still arise, especially if it’s been built quickly. A snagging survey will help you identify any issues before you move in, and will generally cost from around £300, depending on the size of the property.