Buying a property is a massive financial commitment, so it makes sense to find out as much as possible about your potential new home before you sign up to it.
But you are unlikely to spot all the potential issues with a property before it’s too late and you are living there.
That’s why homeowners take out surveys - to get a better picture of the property they want to buy.
The cost of each report varies according to the size and location of the property.
Basic valuation
If you are getting a mortgage to buy your property your lender will insist on a basic valuation as an absolute minimum. Usually they expect you to pay for this – around £250 – but some will throw in a free valuation.
This is not a survey and is done for the lender’s benefit only, to assure them of the value of the property they are lending against.
Lenders need to understand whether the loan they are considering accurately reflects the value of the property. Many will conduct a 'desktop' valuation, which doesn't involve a site visit. But some properties can best be valued by being visiting.
Condition report
You may prefer to upgrade to a more detailed report than the lender’s valuation. The cheapest alternative is a condition report from the Royal Institution of Chartered Surveyors (RCIS).
This is only suitable if the house you are buying is of standard construction – such as a house, flat or bungalow built using common materials, like bricks and mortar. It should also be in reasonable condition. The condition report uses traffic light ratings for different parts of the building, the services and the garage to highlight problems and the degree of attention they require.
It also gives you a summary of the risks to the condition of the building as well as noting any issues that your solicitor needs to investigate further, such as checking planning permission is in place for an extension.
A condition report does not automatically include a valuation, but your surveyor will probably be able to do one as an extra. However, your lender will almost certainly insist that you additionally arrange a valuation through them, so you may have to pay the costs for both.
Homebuyer report
Many purchasers prefer this report as it offers more detailed information on the property. Your lender may let you upgrade its valuation to a homebuyer report so you don’t pay twice, or you can shop around for your own.
A homebuyer report is only suitable for conventional properties that seem in reasonable condition, so if you are buying a very old house you will probably need a more thorough survey.
It looks at the condition of the building and services, and the surveyor will conduct a fairly detailed investigation.
It also uses the traffic light system which is easy for buyers to understand. Green means no work is needed, yellow means repairs need doing but they are not serious, and red highlights defects that should be investigated urgently.
The surveyor will note down any issues that could affect the value of the property and advise you on repairs or maintenance that need to be investigated further.
You’ll also get a valuation as standard as well as an insurance reinstatement figure for the property (which will be useful when arranging buildings insurance).
Building survey
A full home survey that you should consider if you are buying an older property, a property that has been significantly altered or an unusual home.
It will give you very detailed information about your potential new place and the surveyor will spend a few hours examining the building and land.
You will receive a long and detailed report describing visible defects as well as potential problems caused by hidden flaws, advice on repairs, the consequences of doing nothing and advice for your solicitor.
Legal help
The legal work associated with buying a property is called conveyancing. When choosing a solicitor make sure they are qualified to do this on your behalf. In addition there are licensed conveyancers who specialise in the property purchase process.
Prices are similar between solicitors and conveyancers, although some of the larger conveyancers operate online and as a result they have driven down prices so you may be able to find a better deal.
This is known as e-conveyancing. Fans of this method say it is cheaper and quicker than going through a more traditional route with a solicitor. That may be true but remember that the main job of your conveyancer is to check that everything is legally above board and to protect your interests, or you could face enormous costs in the future. A word of mouth recommendation can be valuable when it comes to your conveyancer.
Solicitors are qualified lawyers who have expertise in a range of areas, and if you anticipate any difficulty over and above the conveyancing of your new home, it may be sensible to engage a solicitor rather than a conveyancer, whose responsibilities may be limited solely to the property exchange process.
Other costs
Stamp duty - this is a tax on all property purchases above £125,000. Different rates apply depending on the price of the property. If you’re a first-time buyer you may not need to pay stamp duty. For full details please see HMRC.
Solicitor/conveyancer fees
Purchasing property is a legal process and requires certain work to be done, usually by a solicitor or conveyancer. Costs vary depending on the complexity of your purchase and the fees set by your solicitors or conveyancers, but can range from £500 to around £1,500. Some conveyancing-only services can be done more cheaply online, but be sure you understand the service you are signing up for if you go down this route.
Building insurance
If you have a mortgage your lender will require you to insure the building. This should be taken out on exchange of contracts.
Contents insurance
Contents cover helps you to protect your belongings. Shop around for a deal as it isn’t essential that you choose the policy recommended by your lender, and you should be able to find cover for £20 to £30 a month.
Life insurance
If you have dependents you may want to arrange insurance to pay off your remaining mortgage, and potentially leave a lump sum, should you die. There are different types of life cover that range in price, so take advice if you are not sure what best suits your needs.
Removal fees
If you already have furniture you will probably require a removal company to help you move.
Removal prices vary wildly depending on the number of items that need to be moved as well as how challenging it is to get them from one place to another. A few bags of clothes won't cost as much as a grand piano, for example. Shop around and book a date once you have exchanged contracts.
Removal companies' availability can disappear at a moment's notice, so they may often require you to pay a deposit upfront. For this reason, it's wise to be sure of the date you want.
