Home Buyers' Fortunes – 'and our Survey said…………'

In April, 2019, the Royal Institute of Chartered Surveyors (RICS) launched an industry and consumer consultation following an extensive review of existing guidance. The consultation identified the need for a professional statement with a set of mandatory requirements (the Professional Statement can be found on the RICS website). The purpose of the Professional Statement is to establish a clear framework that sets minimum expectations to protect and maintain consistent high-quality standards for residential property survey services that RICS members and regulated firms provide. The Statement also replaces and harmonises previous RICS publications relating to residential surveys.

The Home Survey Standard will be the single standard for condition-based home surveys and highlights areas of best practice, including considering where surveyors and residential property lawyers will work together and identify items and features that have possible legal implications.

The Professional Statement will become effective and mandatory for all RICS professionals from 1st June, 2020. Conveyancers will need to get used to the new terminology and reports.

What's the current position?

When buying a residential property there are four main surveys from which to choose:

  • The valuation by the buyer's lender

  • A Condition Report prepared by RICS

  • A RICS HomeBuyer's Report

  • A RICS Building Survey

What will change?

The array of previous guidance is being replaced with one document which provides set requirements for surveyors to comply with when providing a survey. The new Professional Statement makes it clear what is within a particular kind of survey and what is not, which will make the process of choosing the appropriate level of survey more straightforward.

The Home Survey Standard will replace the current RICS guidance, practice notes and professional statements relating to the Condition Report, the HomeBuyer's Report and the Building Survey.

The survey process has been simplified and the available surveys have been standardised into the following three levels. RICS members must ensure that their service is clearly “benchmarked” against one of the three defined levels and must clearly state the benchmarked level in their report.

  • Survey level 1 includes a visual inspection but no testing of the building fabric or services. The report is succinct and does not include advice on repairs or ongoing maintenance. This survey will broadly equate to the Condition Report.

  • Survey level 2 includes a more extensive visual inspection but no testing of the building fabric or services. The report is concise but does include advice on repairs and maintenance. This survey will broadly equate to the HomeBuyer's Report.

  • Survey level 3 includes a detailed assessment. Concealed areas (such as roof spaces, basements and cellars) are inspected if possible. Services are observed in normal operation. The report should also cover matters such as the scope, priority and timescale of any repairs (and the consequences of non-repair) and may indicate the likely repair costs. This survey will broadly equate to the Building Survey.

RICS will also be developing supporting materials on the Home Survey Standard, including terms of engagement templates, pre-inspection check lists, scope of inspection and benchmarking assets and a list of equipment. These will be published in the six-month period to 1st June, 2020.

What does this mean in practice?

The Professional Statement should enable and promote improved communication between a homebuyer and their surveyor. It also aims to embrace new technologies and media, which in turn should make it easier for homebuyers to understand the results of their survey – speeding up transactions at the same time. Firms can design and deliver services that not only meet their clients' needs, but that the public can recognise and trust. This should lead to increased confidence, which is likely to result in fewer aborted transactions. The Professional Statement places more responsibility on a surveyor to be clearer about their observations and recommendations, which means that a survey will include fewer caveats and assumptions.

If you require further guidance on this issue please contact us at info@legrossolicitors.com

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