Home buyers are scrimping on surveys to keep down their property purchase costs but could end up with a big repair bill as a result, a firm of insurers has warned.
A poll of 2,000 home owners by Churchill found that 14% of buyers who have purchased a property in the past 20 years didn’t have a survey and relied on the mortgage valuation.
Based on a UK adult population of 50.9m, that equates to more than 7m people.
The survey found buyers are now either not taking a survey or going for the more basic condition or homebuyers report.
In the past 12 months, 9% didn’t have a survey while 17% took a condition report and 13% had a homebuyers report. Just 6% had a building survey.
In contrast, of those who bought in the past three years, Churchill says 10% didn’t have a survey, 18% had a condition report, 20% took a homebuyers report and 14% took a building survey.
Buyers seemed slightly more cautious 20 years ago, with 28% taking a full building survey, although 37% still didn’t have any survey.
A separate poll of surveyors by Churchill found that 36% have seen a trend for people requesting cheaper versions of a survey.
Almost half (48%) of those who relied on a mortgage valuation said work was needed on the property within a year, while this figure rises to 62% for those who just took out a condition report.
More than half (56%) of those who needed major work doing to their property within a year of moving in said the issues were serious enough to have influenced their purchase, should they have had prior knowledge.
Martin Scott, head of Churchill home insurance, said: “It’s encouraging to see the number of people having a survey has increased over time. Only by having a qualified surveyor assess a property are prospective buyers fully informed of the true state of that property, so it is an essential part of the buying process.
“Those relying on a mortgage valuation alone should be wary as this is just a cursory look at a property from a mortgage lender to assess how much it is worth, not a survey looking at the state of the property.”
RICS doesn’t record data on the specific number of each type of survey taken out but says one in five buyers have some sort of survey.
Responding to the survey, Andrew Bulmer, RICS UK residential director, said: “If ever there was a subject needing myth busting, this is it.
“As this data shows, every year hundreds of thousands of home buyers still rely on a lender’s mortgage valuation, assuming that it is some sort of survey. It isn’t. The lender obtains a simple valuation of the property to make sure they can lend safely, and these are sometimes completed without visiting the property using just a desktop valuation.
“The message for home buyers is clear: a home is the most expensive purchase you will ever make and going down a cheaper route will be a false economy if works are required.
“There are various levels of survey, and it is vitally important to have a qualified surveyor look at your property if you truly want to know what you are buying.”