Join us for an insightful discussion on property surveys with two industry experts, Mark Stallard, and Giles Cooper. In this video, we delve into the essential aspects of property surveys and their significance when buying a home. Discover the key differences between surveys and valuations and learn why a mortgage valuation may not be enough to protect your investment. Giles, with over 30 years of experience as a surveyor, sheds light on the two main types of surveys: Level 2 (Home Buyer Survey) and Level 3 (Building Survey), explaining when to choose each. Explore real-life examples of hidden issues that surveys can uncover, from structural problems to unexpected defects. Giles also provides valuable tips for interpreting survey reports, ensuring you make informed decisions when purchasing a property. Don't miss this informative discussion that highlights the critical role surveys play in safeguarding your investment. Whether you're a first-time buyer or a seasoned homeowner, understanding property surveys is crucial. Join us to gain valuable insights into this essential aspect of the housing market.
For more information on residential or holiday let mortgages, get in touch for a free initial consultation here: https://www.hhhmortgages.com/
Good afternoon.
This afternoon I want to talk with my great friend, long standing friend, Giles Cooper.
I want to talk surveys and I want to make this obviously an interesting and insightful session.
And Giles is the man for that. We've worked together right from our Cheltenham and Gloucester days back in the, in the 90s.
And Giles knows an awful lot and is very, a very, very good communicator. So, I'm sure there's lots of questions my listeners have, you know, why this, why that?
So, let's first of all ask, let's ask Giles to introduce himself. And Giles, who are you and what are you going to talk about?
Hi, Mark.
Nice afternoon. Welcome. 1993. God, I was a child. Yes, I've been in the area for many, many years now. I've been in, in Gloucestershire for over 30 years. doing surveys, initial evaluation work, a lot of evaluation work for C& G with you. And then more recently, um, working for a well-known local firm as Surveyors.
And then in the last year or so, just working with a smaller business, working out of Cheltenham, doing residential survey and valuation work for buyers, lenders, solicitors, IFAs, these sorts of people. So, yes anything to do with the house, basically.
Brilliant. We, we all have go-to people in life and Giles is my go to survey man, because if I get completely stuck or confused or don't understand something, I will ask Giles, he will always put it in very simple, plain English as to what.
It's not happening or what is happening, but at least it helps me so I can explain to a client what is going on. Charles, let's just start perhaps then with level of surveys and why is a survey different to evaluation? Do you want to talk about that?
Yeah, absolutely. The general public out there have a perception that there are three levels of survey.
Actually, there are only two.
But if I got a pound for every time someone has said to me, Well, it's all right. I'm having a mortgage survey done on my house. I'm all right. Thank you. I'd be a very rich man. It's worth just sort of squashing that one at the very outside that a mortgage valuation is what it says.
It's evaluation. It's not a survey. It's a 10, 15, 20, 25-minute look at a house and it's really this - simply to tell the mortgage lender what that house is worth.
And I think that's really, really important. It's not a survey.
What's also interesting about that is that actually, a huge proportion of mortgage applications going through at the moment don't actually have a valuation at all. They might have a desktop or a drive-by assessment, but they don't actually have an internal inspection So fundamentally a significant proportion of people raising mortgages Nobody will look at that house on their behalf unless they have a survey and then there are two types of survey that go under the wonderful titles of level 2 and level 3.
For us old people we used to call them the home buyer survey and the building survey and they are the 2 fundamental types of private survey. And which one you have very much depends on what you buy in a nutshell.
If you buy something pre-Victorian, typically you go for a building survey.
If you buy something post Victorian, you go for a level two.
So that's basically where we are with the two types of survey. So, it's two surveys, one valuation.
Brilliant, brilliant. And can we just pick up on the phrases that you use there, drive-by and desktop. It's phrases that you, I use every day and probably. Must stop doing so because clients don't understand that, nor should they.
What is a drive by and what is a desktop?
They are literally what they say, and the frightening thing about this is that it wasn't that long ago that every mortgage application had a valuation done on it, and people like me were employed by the banks and building societies to go in their cars out to these various houses, doing four or five or six a day, going to the house, climbing in the loft, looking out and producing a detailed report.
Nowadays, I say a vast majority are done either from the desk or from the, from the car, depending on the loan to value typically. So, if the loan to value is typically low. Or they're an established client. Then depending on what criteria they fit, the lender will either commission a desktop valuation, which is literally sitting at the desk with a computer saying the computer says the house is worth 500, 000, or a drive-by where you literally drive past the house from the outside and then say it's worth 600, 000 pounds.
So, they are literally what they are. They are very simple valuations based normally on online information. So right-move statistics like that.
Great. Thank you. And so level two and level three, just summarize the difference.
Yeah, level two is - it's actually my preferred report. It's really for, as they describe it, more modern types of houses.
Actually we talk Victorian onwards, but it's houses which haven't been significantly altered. It's your average three bed semi, your average Victorian terraced house that sort of property. It's a great report. It's discussed by the RICS or described by the RICS as an economy survey, which I think is the worst description ever it is actually a significant defects report. So, it's there to tell you things which fundamentally affect the value of the property. Structural issues, roof problems, damp problems, these sorts of issues. The building survey is a much more complex report. It's a word document typically 150, 200 pages long, and it will go into the property in much more detail, and it's geared at houses which have been significantly altered, extended, changed, over many, many years.
So you need a detailed report because there are so many elements of that property that need describing. For most houses, the level two, the old home buyer survey, is the right report to have.
Brilliant. And Giles, you might reply, how long is a piece of string, but how long do you spend on a level two or a level three, just as a sort of typical?
Well, actually, it is a piece of string. It's as simple as that. You genuinely don't know. I think until you pull up in that house, you really, really don't know. And I always say, well, I've always said to people I've worked with in the past, and I always say to myself, every time I go there, you need to spend as much time at that house as you need to spend and this is where I think the difference between private and corporate surveyors come in is that private surveyors have got the time to do one survey a day where they can spend as much time as they need to in the house to make sure that when they drive away they've got all the information they need.
If you're thinking about having a survey done and that surveyor is doing two or three surveys a day, think twice, because he's going to be under pressure to make sure that he moves on to the next one, and he may not have that extra bit of time to go that little bit of extra mileage to find out what's wrong with your house.
Great tip, great tip, and I, one of the, what I'm trying to, consumer duty, means that more than ever, we've got to make sure that the Customer understands what a survey is and has been offered a survey by us. We don't want to be responsible for a customer coming back saying, well, you didn't tell me about a survey.
… we don't want to be doing that. Thank you. And, so it's, you know, we, this is more important to us now than ever. And therefore it's good for customer. And, I've often say to the customer, well, you might spend five or 600 pounds or whatever the fee is, but you might end up saving lots of thousands of pounds.
Is that fair enough?
Yes, totally. Totally. I mean, I've been in this game for many, many years, as you can probably, well, you know, Mark, you know very well. And I think I have yet to do a survey where I haven't walked away thinking that money was worth, sorry, that survey was worthwhile, you know, we always find things.
If we find things which are deal breakers, and I think that's really important to say, is that we're not here to kill the survey, to kill the house purchase. We're here to give you a survey which enables you to buy the house with your eyes open. And I think that's really, really important because what we're trying to say to people is, look, this is what's wrong with the house.
These are the things you need to be aware of today. And these are the things you need to be aware of further down the line and actually a survey is really, really good for that because As an investment tool. It's really good. It's not a guarantee. It's not an insurance policy, but what it will give you a working document so that you can get that house right now.
And as I always say to people, you never know what's going to happen tomorrow. You need to buy the house in the knowledge that you may have to sell that house on again in a few months time or a year or so's time. It's far better that you know now what's wrong with it rather than have someone knock on your door in a few months time or a year's time and tell you then that the roof is leaking.
Great advice. Great advice. Okay, so I'm just doing a mortgage for a young first time buyer on a flat. And he said, well, it's a flat. I don't need a survey on a flat because it's leasehold. And that's not my problem, is it? Is it his problem, Giles?
Yeah, I think, I think surveys on flats are... an area which are always sort of pushed to the side.
In the old days, the RICS used to have a specific flat buyer's report, so you bought a house or a flat and depending which one you bought, you bought that particular report. Surveys on flats are absolutely vital if you are buying a flat, you are buying into a bigger building. So, for example, if you've got six flats in a classic Victorian mid terraced house, your flat on the first floor may be absolutely great.
It's not going to have any rising damp, it's not going to have any leaking from the roof because it's mid floor, it's fantastic. The problem you've got is that you have got an inherent sixth liability to contribute towards the roof. The dampness coming into the basement flat, the pointing of the walls, the parapets, the gutters, the dampers, the windows, whatever else it might be, but absolutely a flat is really sorry, a survey on a flat is absolutely important. And 1 really, really good tip. Somebody buying a flat can do at the very, very outset. It's asked the solicitor to make sure that that flat is effectively managed. In other words, the building that the flat is in has got an effective management organization with a reasonably good sinking fund and an annual service charge.
If those things are all in place, then you can at least buy the property with a little bit of reassurance knowing that somebody is looking at that building and is spending the money to maintain it. If you're buying a flat that has got no management company, you are very, very exposed. But yes, surveys on flats absolutely key.
More important than ever. Brilliant. That's a really good answer. And I, one thing I picked up there, can you, can you always find out what money is in the pot, as it were?
Yeah, it's always the question you can ask, my worry is self-managed blocks where the residents manage the building. Because unless you've got a property expert in that group of people, he may not understand building well enough.
The analogy I always give is that you can, anybody can put... nice magnolia wall and paint and wallpaper around the common parts in the hallways make it look very, very smart. But is anybody up on the roof looking at the valley gutters and the chimneys and the flashings and everything else? So you need somebody that manages the building well and understands building to make sure.
That money is the question, how much is in the pot? And more importantly, how much do you have to pay a year to go into that pot? And if you're paying a hundred pounds a year, it's not enough. If you're paying a thousand pounds a year, it's probably about right. Okay. That's interesting because the other thing I think we're finding more and more with the leasehold properties is the ground rent, ground rent is becoming a problem with, with lenders as well.
Yeah, ground rents are, and particularly escalating ground rents is the one you've got to work with new build properties, ground rents on period properties are generally not a problem, but if you're buying a new build. House I might say as well as a flat.
Yeah, you need to be very very sure about the ground rent and Are there any hidden charges? Is the ground escalating? Is there an estate charge? I mean we're going off to a slight tangent, but you know if you're buying on a modern housing estate Is there an estate charge which covers the communal areas the playgrounds the roads and everything else all the cutting the grass? Often local authorities insist on an estate charge and again that figure too can rise really really steeply as the years go on.
Yeah, I'm finding with the equity release inquiries I'm getting and they're becoming more and more, and it's all about the property and it's all about those kind of charges and the equity lease lenders, because they're going to be the ones that sell the property. Most likely, they don't like it at all. So, uh, now listen, I don't want to upset you on a Friday afternoon because you're a good man, but I want to just touch on, on your, your Bete Noir, the new build.
So, no, Giles is always a bit cautious about New Builds and he's going to tell us why, I think, now - what's going on in New Build world, Giles?
New builds are a worry to me. I think again, you know, in the old days when, when, housing developments were built the builders and the site foreman were all local people.
So in the Victorian days, you know, the builders were local. The, the site foreman lived down the road. He, they all drunk in the same pub. They all knew each other and they built a good product. The problem we have these days is that with a lot of the modern estates, we can't get the workforce and so we're shipping in a workforce from all over the country to build houses.
The site foremen are going from one site to another. They may not have local knowledge. They may not even have constructional knowledge or at least enough constructional knowledge. And what we're seeing as surveyors is that the, the actual finished quality of these houses is really, really poor and...
But they look so shiny, Giles. Sorry? They look so shiny.
They look lovely and shiny. And, you know, you can make anything look nice. It's my flat. You can make anything look nice but, you know, at the end of the day... Doing a survey on a new build is always great fun and I love it, and I can normally tell within 30 seconds of going up into the roof of a house, in particular, whether that construction has been well built or not.
And the other thing to bear in mind is a lot of houses not being traditionally built these days, You know, the days of brick and block houses are really diminishing. We're now on to timber frame houses, SIP houses, which are, you know, insulated panel houses come on the back of a lorry. One day there's a field, next day there's a house and these have to go up to actually the millimeter, millimeter tolerances and if they're out in any way that house is, uh, is compromised. So absolutely new builds are really, really hot potato of mine. And I would suggest anybody buying a new build. You not discount a survey, at least look into it, because I think moving down the line, four or five years when these houses come to be resold on, that's when the problems are showing through.
And just a couple of couple of things that you've seen, a couple of stories that you can tell so it's just does anything come to mind?
Yeah, I think, you know, as I said earlier on, I think we, we never see a house or I never see a house that hasn't got something which needs to be passed on.
And I think that's the moral, really. I mean, you and I could chat all day about. The, the, the house where the guy's chopped his chimney out or whatever. He is done. I mean, we're, we've just, just involved this week in one where, it's, and the client on the top floor, the, the foot zone on the top floor, has decided to put a hot tub on his roof.
So what he's is, he's literally cut out some of his, the roof on this book of flats and he's created a deck. He's got the hot tub he's fun installing. He's got a TV of the town. And his hot tub. The only problem is he's now compromised the roof. He's got all the way to the water. And more importantly, he's compromised the lease.
So, you know, you never know what's going to come around the corner. Sad story, but great story. I remember Charles, you told me about, well, you had to go into an estate and they've got the size of the staircase wrong. Haven't they?
Yeah, that's dangerous. Someone could kill themselves.
Literally. Yeah, absolutely.
If you come down the stairs or opposite, but if you come down the stairs, your brain automatically triggers the same width of the stairs with the same rise of the stairs. So, consequently, those stairs are out by a couple of millimetres. If the bottom tread is slightly at a different height, then you will fall over.
So, yes, absolutely. And this was a block of housing development where we suspect that most of the staircase on that development were wrong and the repair. Yeah. Was astronomical because potentially the only thing you could do is to replace the staircases. It was literally over a few millimetres but that was enough to kill you if you weren't really, really careful. So yeah, you build again, really, really careful with new build housing. It's interesting.
And my next question is going to be to ask you about things that valuers have not spotted, but I mean, we can, we can just do the hot tub, can't we? Because a drive by or a desktop or even a value, I might not spot that.
Yeah, absolutely. I have, you know, the word to me is that 75 percent of people buying a house or a flat won't have a survey and, and it worries me immensely because, you know, for the investment that we, we take off people we will find things wrong with that house, which I say not to stop you buying it, but at least make you buy it in the full knowledge that when you come to sell it, those things won't be a problem too.
So yeah, absolutely. Have a survey or at least, at least ask about having a survey. Okay, so, um, let's sort of start to wind up now and let's talk about how you work with a customer. So, if I refer Mr. and Mrs. Bloggins to you, what happens, mate?
I always say to people, talk to me about what you're buying.
Let me find out where it is. Let me look at it online. We can discuss the type of survey. I can give you a quotation. We can send you an example survey. I will leave you in peace. I won't be bringing you every 30 seconds saying, hey, what about using us? It's entirely up to you. I will give you the facts. I will talk to you about it.
And then we will give you the information if you decide to go ahead. We do all the work, we book it all in, we do the survey, and then more importantly, we talk to you. We talk to you on the day of the survey to discuss what we found, we give you the written report a few days after that, and then we talk to you again after that, when you've read it, so that when you walk through the door with your keys, you know exactly what you're walking into, what you need to look for, where your repairs need to be, and what your expenditure is.
And we're always on the end of a phone, that's the important thing.
And is it fair to say, Giles, that when the survey report drops on the doormat from the nice postman, provided the dog hasn't got it first, is actually quite a foreboding document. It's full of, it's full of caveats and paragraphs and subsections, so it's quite a scary document.
Any tips on how to read a survey?
Absolutely. I mean, the first thing to say is, luckily for us, we rarely post. We normally… but yeah, the report, the report is a… that was a bad time, wasn't it?
The report is a difficult document to read. And I think, you know, what's really important is that you discuss it.
And that's why I say we always make a play on making sure that people discuss the survey with us. The day we've done it we talk it through, read the report and then discuss with us again afterwards. It's really, really important that you discuss the survey with your surveyor. And we will do that as many times as people want so they fully understand what they're buying.
And yes, don't just buy a survey, read it and then ignore it. Discuss it. That's the key.
Brilliant. And Giles, a little commercial for your good self. Who are you? Where do you work? And how do people get in touch with you?
I work for a company called Certus Property Consultants. We're based in Canberra Place in Cheltenham we cover pretty well anywhere within your neck of the woods, Mark. Uh, so we go anywhere within sort of Gloucestershire, Oxfordshire, Worcestershire, Wiltshire, you name it. Surrounding counties if in doubt, give us a ring. Certus Property Consultants. Be delighted to have a chat with you.
All right, Giles. Thank you very much indeed. And any final things you want to say? Any caveats or, uh?
No, nothing to say, the only thing I would say is if you are involved in buying a property, a house, a flat, uh, anything like that, please at least think of a survey. Don't be one of the 75 percent that discounted outright.
And please, whatever you do, don't rely on the mortgage valuation. It is a valuation,
Brilliant. Thank you, Giles. Thanks for your time, as always you know, we, Giles and I have a lot of fun together, that was quite a serious chat, but I think it needed to be serious because it's a big point to make. And, I think as Giles has alluded to, if you're putting in 29 grand of your own cash or 63 grand of your own cash, you don't want to see that go down in smoke because someone's built a hot tub on top of the roof.