Homebuyers Survey ?

[Richlist]

Does anybody know the point of having this survey ?

I'm currently a couple of months in to selling a property and the buyer has commissioned a homebuyers survey. I met the surveyor at the property, he asked me about 10 simple questions, measured the rooms, filled in a form and it all took no more than 10 minutes.

I'm told they cost up to £500.

Anyone know anything about these ?

[Grampa]

My understanding it is the basic survey the mortgage company requires to assess the property is at least equal to the funds that are being borrowed so if it was repossessed the mortgage company will at least recover the amount lent.

I stand to be corrected on this though.

[Melboy]

A homebuyer's report is not a proper investigation like a structural survey.

It is probably totally worthless if the truth be told and it is mainly to cover the mortgage lender lending the money to the lender.

Location, general condition etc. are the main questions being asked and of course any risk involved in the lender losing money on the deal should there be a default on the mortgage.

Nothing beats a good qualified builder being paid a bung to go and have a good look at the property and in my case a good plumber to check out the heating and plumbing systems and a qualified electrician to check out the electrics.

Some of these professional surveys carried out have so many caveats now as to what should be done by other trades it is not worth a jot or the expense.

[Richlist]

Thanks for the responses so far....but it just makes the buyers actions even more of a puzzle.......

* They are cash buyers. They have stated this & agents have confirmed this and the surveyor is acting for the buyers not a lender.

* Buyers are experienced landlords (with at least a couple of years and at least one other property, possibly two already).

* The buyers did spend a long time looking at the property.....in some detail and were quite knowledgable about basic building matters themselves.

* They live in the area.....just a few miles away so, know the location.

* The property is a leasehold apartment which makes a homebuyers survey even less logical given the service charge company/ block insurance policy set up etc.

* They have a tame builder who renovates/ refurbs for them so why not send him in to look at what needs doing ?

I guess they could be hoping that the survey results will provide justification for a drop in their offer price but given the fact that the surveyor won't have found anything they don't already know in his limited 10 minute visit.....that's somewhat unlikely to happen.

On the plus side, they will now have spent another £500 towards their purchase and that together with any aborted legal fees may well mean they will feel less inclined to pull out of the deal.

In any event I just don't get it.

Its a complete mystery to me.....maybe I'm missing a point somewhere......Any other comments or ideas ?

[Melboy]

You have probably answered your own question RL. Looking for a reason to push the price down.

With a £500 committment spent I would be happy that it has got this far already.

[Richlist]

Looking for a reason to push the price down.

If that's the case, they might be in for a bit of a surprise then.

I could agree to reduce the price BUT property prices have risen significantly since the deal was agreed ....... which is likely to result in net overall increase.

This is really good fun isn't it ?

[Richlist]

* Seems the survey showed up nothing and

* It hasn't resulted in a revised offer and

* Simultaneous exchange & completion looks likely next week.

Happy days.

I can think of better ways of wasting £500 !

[Melboy]

Why are you selling RL?

[Richlist]

I'm selling for a number of reasons......mainly:

1. I want to reduce the overall size of my portfolio.

2. To minimize CGT liability I'm selling one property per tax year. .

3. As a property becomes vacant it provides me with an opportunity to sell.

4. Prices in my area have risen sharply over the past year & with property selling fast.....now is a good time to sell.

5. I paid cash for this property & I'd like my money back.

[Melboy]

Yes all the reasons I have sold out over the past years.

Only one major mistake I made though was to sell a property back in 1998 just before the big price explosion only to find it was sold again at a profit of nearly £70,000 to my buyer some 5 years later.

I wanted to keep this property but unfortunately I was tied into goodwill contract whereby when I purchased it very cheap it was on the understanding that after 5 years of renting out " they" had the option of calling in the favour given to me.

I did make a good sum of profit which I was told was good enough and the original selling favour was being called in.

(If this doesn't make sense to you think of the Mafia )

[Richlist]

I view buying & selling property in a similar way to shares. I've been an avid share buyer for over 20 years and learned that its impossible to guess either the top or the bottom of the market.

When I buy shares I satisfy myself they are at a bargain price. Provided I sell at a profit, I never concern myself with any subsequent rise or fall in the price and that's exactly what I do with property......I just move on to the next one.