There is no requirement for all building surveys to cover the same things. This means there can be a lot of discrepancy between different surveys. Building Surveys are visual inspections and therefore the survey should cover everything that is visible. This includes inspecting any lofts that are accessible, lifting manholes cover where possible and visual inspections of the electrical, gas and heating systems. Anything concealed within the building fabric or by large furniture won't be included.
Buying a new home is one of the most expensive purchases you will make. At Lamar Chartered Surveyors we believe you should know exactly what you're buying. The RICS Building Survey allows you to make an informed judgment about the condition of the property so as to avoid any unexpected expenditure when you have moved in. Our building reports highlights any decision and actions that should be taken before contracts are exchanged and assists you in predicting if any future maintenance expenditure is likely to be required. If you are interested in buying an aged or altered property or are planning major renovations, the Building Survey report is an ideal safeguard for you
A Homebuyers survey is a RICS standard report which is designed for people in the process of purchasing a property. This is generally suited to flats and house of around 3 to 4 bedrooms and of standard construction. The report provides a 'traffic light' rating system regarding different elements of the property both internally and externally. The rating given to each element depends on their severity with a rating of 1 having no issue and 3 require immediate attention. This report includes a valuation of the property and is approximately 30 to 35 pages long.
Building Surveys are suitable for all properties but they are particularly recommended for older or larger buildings or where one is in need of considerable repair, or where there is a visible defects which are causing concern. It is much more comprehensive than the Homebuyers Report (although it does not include a market valuation as standard). The report is an in depth assessment on the structure and stability of the property and includes advice on necessary repairs, maintenance and the likelihood of hidden defects. Recommendations for repair are given, and if necessary, further investigation advised.
Purchasing a property is likely to be the most expensive thing you will ever buy, therefore, it is important to have the peace of mind that the property is in the condition that you believe it to be. A survey might seem like a lot of money, on top of numerous other expenses involved in the purchase of property, however, an extra cost now may save you from much larger expenditure further down the line! It is far better to know about any issues with the property, prior to purchase as you can then budget for any repair work.
We look for any current defects with the property and will comment on possible future defects. We undertake a visual inspection of the entire property, externally and internally. This includes lofts, basements and external areas. During the inspection we check the property for all defects including signs of damp, dry rot, cracking, structural movement, missing parts, hazardous building materials, and evidence of flooding and general disrepair. We may then comment on suitable actions to take to fix or prevent these defects.
An independent survey will help you find out about the condition of the property. If there are any issues or significant problems with the building in question, the survey will provide you with an informed decision on whether to proceed with the purchase. In some cases the results of the survey could be used to the request that the seller fixes any problems flagged up prior to moving in. This results in avoiding unforeseen further extra expenditure on putting any snags or issues right that you didn't know were present prior to purchasing the property in question.
A Homebuyer's report is a detailed survey best suited to 'traditional' type First Time Buyer Properties [flats & houses - 3 / 4 bed maximum] in reasonable condition and of standard construction / build and size [less than 1,500sq ft.]. These can include London Period Properties, Conversions and Ex-Local Authority properties.
A valuation is suitable for a house purchaser because it provides the purchaser with an indication of the current market value. It should be noted that a valuation is purely based on the value and does not assess/provide information of the condition/construction of the property in question. If the condition/construction is more of a concern then a condition survey/building survey is more appropriate. However, if the condition as well as the value is of equal concern then a homebuyers is suitable for their needs. To summarise, the answer is yes. If you are concerned about the purchase price then a valuation report will meet your needs, but if condition is also a concern then a homebuyers is more appropriate.
A homebuyer's valuation and a valuation report differ by the depth of analysis and work (on paper). However the same due diligence/searches is undertaken in each scenario, but for a pure valuation report the comparable transactions and an analysis is documented in more depth. Whereas a homebuyers is just the value, e.g. £250k.
Once you have bought a home, most insurance schemes are index linked and valid for five years based on the initial valuation. After that the owner is responsible for updating their policy and so a building replacement insurance valuation can often be a wise move. Whatever you do, check your policy's terms and conditions to avoid risking shortfall in claims.
A snagging survey is designed to find out if there are any immediate problems with your new-build home. Your surveyor will come round and check everything from minor problems like leaky taps and bad finishes to more severe problems like structural issues.
You should get your snagging survey done before you move in, and preferably before you sign the completion documents, as any issues your survey discovers will be quicker rectified if found before you legally agree to buy the property. Try to get the snagging survey done as soon as possible after the building has finished so developers have time to fix any 'snags' that the survey might find. In some cases, the developer won't allow you to have a survey done before completion so you'll have to book it for just after move in, though you can have a snagging survey done at any time over the next two years, and the developer will still have to fix any problems found.
Your surveyor will come to the property and check all the doors, walls, windows, fittings etc. Then they will write up the survey report and pass it directly to the developer to speed up the repair process. Once the developer has received the survey results they will have to rectify the problems within an agreed time period.
The rent review clause in your lease will direct how and when the rent should be reviewed. Usually by reference to a hypothetical letting of the subject property having regard to open market rents paid for comparable properties let at or close to the rent review date. It makes sense to start considering your rent review strategy about 18 months before the review date stated in your lease. If you haven't already, make a diary note of this date now. Even if you don't engage professional advice at this juncture, you should check your lease to ensure it does not stipulate a time limit within which either the landlord or tenant has to issue, or respond to, notices instigating the review. It has been known for tenants to end up paying inflated rents simply because they have failed to respond within the time limit. This is particularly pertinent if your lease has a break option with strict time limits around the same time as your rent review. About 12 months before the review date, either you - or more likely your appointed agent - should start to monitor the local rental market. This will allow you to set a budget rent and to establish in which direction market rents are moving and therefore the best time to start negotiations. If the rental market is rising you should instigate negotiations as early as the lease permits. Conversely, if rents are falling you will want to wait as long as possible. This strategy will help furnish you with the most favourable comparable market evidence.
The length of time it takes to negotiate is dictated by the stance of the parties and how aggressively they negotiate. Depending on the level of either consensus or dispute, a rent review can take as little as a month or as much as several years to negotiate.
If a rent cannot be agreed or your landlord is employing delaying tactics - a common occurrence in a rising rental market - the lease will have a dispute mechanism. Normally, this can be operated several months before or at any time after the review date and involves the appointment of either an arbitrator or independent expert to determine the rent. Once appointed, the third party will usually direct a timetable for making representations to him to determine what the new rent should be. In the majority of cases the landlord and tenant will agree the rent within this timetable, thereby achieving the desired result of reaching a swift conclusion to negotiation. Where the parties do not agree the revised rent, a third party will determine it following representations from both sides. An arbitrator has the power to award costs against the losing party. Consequently this can be an expensive exercise.
It is a common error to assume that the market rent achieved on other properties should be directly applied to your property at review. This is the approach your landlord will take to achieve the highest possible rent. They will always quote the highest rents achieved on the best buildings for the most favourable terms . However there are various factors that can be brought into the negotiation which may help counter proposals to increase the rent. Tenants are often unaware of these factors. The rent review clause will usually contain various valuation assumptions and disregards to be made. These will relate to matters such as improvements you have made to the property at your own cost that the landlord attempts to 'rentalise'.
In addition, the terms of your lease when assessing open market rental value can be critical. If the terms differ from those being agreed on new lettings then the rental value of your property may also differ. This covers a variety of factors from repairing liability to differences in the length of lease agreed. Also, when considering open market rental transactions, allowances may be needed to account for differences in the properties with which you compare the subject. These factors can be wide and varied but some that regularly arise are property age, specification and amenities. For example, offices that have air-conditioning will usually attract a higher rent than those that don't; a brand new property in the same location will attract a higher rent than an older property offering equivalent amenities. Location is also important particularly with retail property where the difference in value for one side of the street to another can be substantial.
Another interesting feature of a rent review clause is that while it may appear to direct you to do one thing, in reality it can mean something else entirely. The length of term is a classic example. It is often expressed by reference to the original number of years granted but has been construed by the courts in a number of well documented cases to mean the unexpired residue of the lease. In today's market, shorter leases are becoming the norm and therefore it may be that if the length of your lease is longer than the market norm this could result in mitigating any proposed rent rise.
When you arrive at the intricacies of the process it becomes clear that taking the advice of a professional rent review surveyor is advisable. Most tenants are specialists in running their businesses but not rent review negotiators. Anyone can agree a revised rent but it takes an experienced advisor/negotiator to agree the best possible rent for you. It is for this reason that we strongly advise appointing ansurveyor from day one of the process. The RICS can provide a list of suitably experienced chartered surveyors in your area. Recommendations from other occupiers in your area can also be a useful guide. If you used an agent to acquire your current property they will probably have or be able to recommend a suitable advisor. They will also have the benefit of knowing how the original transaction was brokered and this can also assist negotiations.
The fees you pay a rent review advisor will depend on the size of property and complexity of the case. It's often useful to agree a success-related element to your fee agreement to ensure that the agent is sufficiently incentivised to get you the best possible result. Before you appoint an advisor, get a written proposal from two or three agents outlining what they will do for their fee. This is a good way to establish who will work best on your behalf. Remember the agent offering the lowest fee may not always be the best candidate.
18 months before the expiry date would not be too early. A landlord should be considering its future intentions for the building, whether it be for redevelopment or enhancing value. A tenant will need to consider whether the premises remains suitable for their business and if relocation is contemplated then considerable forward planning is required before the expiry date. Lamar Chartered Surveyors Leasing teams can assist here. Dilapidations implications may well arise in these circumstances and we are experienced in advising on both the valuation and legal aspects of such claims.
A Section 25 Notice must be in a prescribed form. It is vital that the content of this notice is carefully checked straight away, do not ignore the notice. The Section 25 Notice will also tell you if your landlord intends to oppose a tenancy renewal; there are specific grounds where this is permitted such as for redevelopment purposes or for his own use. You may need to plan an unexpected move. We can refer you to our Office Leasing Team to help you with this. If the landlord wishes to keep his tenant after the lease expiry but on new lease terms, again a Section 25 Notice will need to set out proposed terms. We can advise you on these terms.
If a commercial tenant, in the knowledge that the lease is coming to an end, wishes to instigate renewal negotiations he can serve a Section 26 Notice on the landlord requesting a new tenancy. Both landlord and tenant can make an application to Court to progress the grant of a new tenancy, but there are strict deadlines for the tenant.
Where the tenant has the protection of the Landlord & Tenant Act 1954 then strict procedures must be adhered to. Strategic timing of the notices and counter notices will improve the party's position and as market conditions are a deciding factor in determining the strategy, a lease consultant is the most effective person in the process to achieve this aim.