When buying a new property, a professional home survey is absolutely essential. Whether you choose a simple Home Buyer Report or a more comprehensive Building Survey, it is important to be completely aware of any issues in advance.
But what happens if you get a bad house survey?
Not only will a home survey flag up any existing problems, it can be useful in helping you to negotiate a reasonable purchase price. Regardless of the benefits, however, receiving a bad home survey on a home you are excited about can be disheartening.
It’s true that buyers can be put off by problems highlighted by your chartered surveyor’s home survey report. However, just because something you hadn’t noticed is brought to your attention, it doesn’t always mean that you will need to pull out of the purchase.
The first thing you should do when you receive your Home Survey report is to speak to the surveyor. Your Chartered Surveyor will be able to talk through the report and give you expert guidance on the severity of the issue or issues identified to help you understand the implications for the property and your prospective purchase.
At the crux of the questions about the house survey, you should ascertain with your surveyor whether or not the issues in the report require the attention of specialist contractors. What’s more, you will need to establish whether these works could add up to a costly bill for you if you proceed with the purchase.
What is a bad house survey?
When a Chartered Surveyor conducts a house survey, they will be looking at a range of specific areas of the property in detail. Some of the most common issues identified in home survey reports include:
- Electrical issues
- Damage to structural wood (e.g. through wet or dry rot)
- Japanese knotweed infestation
- Faulty drain pipes
- Roof issues
Upon completion of the property inspection survey, your surveyor will produce an analytical report in which any defects (relating to any of the above, or other areas) are outlined with details on necessary repairs. The survey is often accompanied by extensive photographic evidence to supplement the written information in the report.
Can you negotiate house price after the survey?
One of the principal reasons for getting a survey before proceeding with a property purchase is precisely to ensure any issues are uncovered. So negotiating the purchase price and/or demanding that any such issues are fixed before the purchase is completed is, essentially, the goal.
Remember that your purchase is ‘Subject to Contract’, which means that you have the right to change your mind at any time. The results of the survey can also mean altering some of the specifics of your contract to include requirements on the vendor to repair identified issues before completion – which they will be legally obligated to do.
For the vendor, a sale falling through can be expensive and time consuming, which is something they will want to avoid. Be open with the results of the survey and use this in negotiations.
As long as you have not exchanged contracts on the property then you are able to reduce your offer to reflect the results of the Home Survey. There is no guarantee that a new offer will be accepted, but you are now in a better position to negotiate as you have written proof of the defects and their likely costs.
By how much can I reduce my offer after the survey?
Bear in mind that you have two choices. You can either renegotiate the price and take on the costs of repair yourself, or get the vendor to do it before exchanging contracts. You should, therefore, find out how much the problems will cost to fix (your chartered surveyor will be able to help you here).
The alternative to reducing an offer is, of course, to request that the seller shoulders the brunt of the costs of fixing the issues. Again, however, it isn’t guaranteed that the seller will agree. What’s more, fixing the problems before the sale can go through would hold up the chain.
In most cases, it is more prudent to establish how much you can reduce your offer by, and begin negotiations.
Finding out how much problems will cost to fix
If your surveyor has recommended that further investigations into the issues in the house survey should be handled by specialist contractors, your next step would be to contact a selection of such contractors for a quote for the repair work. By choosing a surveyor that has a lot of local experience is a good call here, as they will be able to recommend the best contractors for the job.
Though the price of repair could change in the future, you will be forewarned of the likely expenditure to have these issues rectified or repaired.
Let the seller know that you are still interested in the property but need to find out how much the issues will cost you after the purchase is completed. This allows the seller to recognise that you are still interested and reduces the risk of them finding another buyer.
Robinson Elliott Surveyors will be able to advise you as to the best course of action in regards to how much to reduce after survey. We’ll take you through the details of costs you’d incur and any other factors that may affect your negotiation position, providing informed, expert advice to help you get the best price for your purchase.
What to do if the survey shows problems
Finding out that the property you are proposing to buy has structural or other issues can be quite alarming. Nonetheless, it is important to be informed, especially when it comes to such a substantial purchase.
The Home Survey is designed to provide you with a comprehensive understanding of the current state of the property which, after all, you will be responsible for legally and financially. It is also important for insurance purposes.
The results of a negative Home Survey report can be a blessing, allowing you to prioritise remedial works to your new property, and even obtain a lower purchase price. It does not necessarily mean that you can no longer go through with the purchase.
If you have any further questions regarding what happens after house survey results come in, how you can reduce an offer after a survey, or if you simply wish to find out more about a survey on a property you are interested in buying, get in touch.