What is the cost of a survey?
Firstly let’s look at the price of a survey? - The long answer is that the price of a survey is determined by a number of factors. Mainly, complexity of the property, the scope of the instruction, the level of skill required in making appropriate assessment of the property, and also the level of liability that will be carried by the surveyor. In simplistic terms, the price of a survey is governed by size, complexity, age, condition and, to an extent, the agreed purchase price.
Most Chartered Surveyors are charged out a rate of £100 per hour and, therefore, the price of a survey is related to the number of hours that it will take to make an appropriate assessment of the property. In reality most detailed Building Surveys will take half a day on site with a further half day attributed to production of the report. It is therefore fair to say that a Building Survey would cost somewhere in the order of £600-£800 plus VAT. A more simple, less detailed survey such as the RICS Homebuyers Report and Valuation would typically take a couple of hours on site followed by a couple of hours of work in producing the report. Therefore, a typical cost of a Homebuyer would be circa £400-£500 plus VAT. Clearly prices vary on a geographical basis and to a degree are influenced by supply and demand.
The cost of a survey is an open-ended question. Perhaps the easiest way is to begin by assessing the cost of not doing a survey. If you are buying a car you would quite likely have a friendly mechanic to look it over to check you weren’t buying something that is a total liability, to give some idea of the on-going maintenance cost of the vehicle, and the approximate value of the car. You would also have the friendly mechanic ask questions as to service history and past maintenance regime. It would therefore make sense in buying a property of many, many times the value of a typical car to instruct an independent expert to carry out an assessment of that property to ensure that you are not buying something with inherent defects which you may well be blissfully unaware of during the period of ownership. However, when you come to sell these latent defects may well be flagged up by your buyers’ surveyors and they may well come back to you to say “we have found these problems and need a reduction in the purchase price”. It is therefore important to ensure that you are not buying a property with any latent defects that may come to light later on.
It is also important to assess the maintenance regime of the property to determine the short- to medium-term running cost of the property. This would involve an assessment of works required immediately to the property to bring it up to an acceptable standard, but also then on-going rolling maintenance costs that you might expect to encounter during the medium term.
It is all of these many factors that will be borne in mind by an experienced surveyor in carrying out an assessment of the property which you wish to purchase. If you do not have a survey carried out, you do stand to take on a property with significant latent defects which may well come to light at a later date and cost you a significant amount of money in terms of reduced realisation of sale price.
One good example of the cost of a survey; a client of a firm of chartered surveyors who instructed a survey of a large house at the cost of £6,500 plus VAT. The surveyor subsequently discovered some significant latent defects with the property which led to some £300,000 being expended by the vendor prior to completing the sale. Had that client not requested a survey, then that client would have inherited those latent defects and that £300,000 cost may well have been levied on them when they came to sell at a later date.
For most people, the purchase of a property is their biggest single investment. It, therefore, makes sense to ensure that they are getting value for money and not inheriting a latent defect, nor taking on a property which is going to cost a disproportional amount of money to maintain over the years due to neglect during the course of the previous ownership.
A surprisingly large number of people do not have surveys carried out on the basis that there is "nothing wrong with the property" in their (layman’s) eyes. If, however, when they come to sell their buyer subsequently instructs a surveyor who finds problems, this may well come back to haunt them and could cost substantially more than the survey would have cost at the time that they purchased the property whereby giving them the opportunity to revisit the agreed purchase price prior to entering into a legally binding commitment to purchase.
So whether you are expending, four, five, six or eight hundred pounds on a survey for the benefit of peace of mind, greater insight into the property and in terms of reducing the overall risk and liability of ownership, the cost of a survey is small in the context of the overall purchase price and the possible liability that you may well be acquiring.
Richard Edward Moore Winder