BUYING a home comes with heavy costs – and there are plenty of mistakes and traps to avoid.
Saving for a deposit is already a huge feat, but on top of that, you’ll have extra charges when buying a house.
Gareth Belsham is a property surveyor with more than 30 years of experience
Most sellers will want to save as much money as they can, but sometimes it’s worth spending more to save in the long run.
One of the extra costs buyers will face is for a property surveyor.
A property surveyor will check the house you’re thinking of buying for any defects such as mould or potential future problems.
They’ll most likely spot things you would have missed and can be of great value so that you’re not spending extra cash later down the line.
Gareth Belsham, a property surveyor and director of real estate company Naismiths, shared his thoughts on where buyers and sellers go wrong.
Hidden charges with leasehold properties
One of the biggest mistakes buyers make when buying a house is choosing a leasehold property without understanding the extra costs or rules around it, Gareth said.
Around 8 per cent of houses are leasehold properties in England, compared to the majority of flats.
In other words, they’re common and not always possible to avoid, but it’s important to know what you’re getting yourself into.
Owning a leasehold on a property means you have the right to live in it for a set period of time.
In the UK, the standard amount of time is 125 years, but it could be more or less.
Unless you extend it, the ownership of the property returns to the landlord when it’s up, also known as the freeholder.
Gareth said it’s important to consider how long is left on the leasehold before buying it as the longer buyers leave it, the more money they stand to lose.
He added: “The length of the leasehold remaining is of really pertinent important importance.
“You might buy a 70-year lease, live in the building for 10 years and go to sell it and then you’ve only got a 60-year lease.
“Mortgage companies will genuinely not lend on anything less than 70 years so you’ve got a de-valued leasehold then.
“Lots of buyers catch a cold when they’re buying at the tail-end of a lease because it’s a devaluing asset and it’s gonna cost money to extend it.”
He added: “The less time left on a lease the lower the value of the property you’re buying.”
The cost of extending a lease varies wildly – from just £1,000s to £10,000s.
Another issue with buying a leasehold property could arise if you live in a building block.
The property surveyor said: “If you’re in a block of flats then somebody owns the freehold of that block.
“That freeholder is responsible for maintaining the condition of those parts of the building that might not be connected to your property like the roof.
“You might be in the middle of the block of flats but if the roof is knackered you’ll still have to pay for that by a service charge [as the leaseholder].”
This is why it’s important to not only look at the interior and parts of the leasehold property during the survey.
Instead, you’ll also need to look at what might in as part of the service charge.
Service charges are paid by the leaseholder for the services provided under the terms of the lease.
It’s different to ground rent, which is a fee charged as a condition on your lease for the land your home is on.
Finding the right surveyor
Another mistake Gareth said buyers make is choosing a less qualified surveyor in an aim to save.
He said it is important you pick one who has the appropriate qualifications to not only carry out the survey, but also one who is covered in case they end up making a mistake.
“We’d recommend RICS Chartered surveyors who carry professional indemnity insurance so if they’ve given you bad advice, you have an institution that will govern the services that they deliver,” he said.
A RICS qualified surveyor could cost you around £600, which can seem like a lot but may save you cash down the line.
If they give you poor advice and you have been left out of pocket, you can make a negligence claim.
There are other qualifications a surveyor will have such as from the Chartered Institute of Builders too, just make sure they’re fully trained for the job at hand.
Gareth said: “It’s really looking for that professional status and of course accountability, which is covered by professional indemnity insurance.”
It’s always important to shop around – choose one that’s right for you and make sure you’ve done your due diligence first.
Not even using a surveyor
Another mistake Gareth said buyers make is choosing not to use a surveyor in the first place.
This is risky because you don’t know what you’re getting yourself into and what state the property is in.
He said: “People who don’t get a professional survey done tend to rely on the mortgage lender’s survey, and their survey is really just a box tick to make sure that they’re not going to lose money on the asset.”
This survey won’t be helpful for a buyer, but if you get your own surveyor in, they will conduct it to your advantage.
Surveyors will pick up on things like non-compliant alterations – shoddy work that doesn’t fall under building regulation rules – that have been carried out on the property.
Gareth said a good surveyor should pick up on this and they’ll warn the buyer of the risks.
He added: “Unscrupulous sellers will do things like put things bits of furniture around the property to obscure defects like dampness and stuff like that.
“So you’d expect a competent building surveyor to get stuffed moved out the way and dig deeper – get under the skin of the building to advise you where the real risks are.”
Do you have a money problem that needs sorting? Get in touch by emailing [email protected]
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