SURVEYING


of survey products out there to meet consumer needs, local surveyors are becoming far more pro-active in marketing condition reports, increasing consumer demand. So do these trends really threaten sales? As stated earlier, the majority of


purchasers base their decisions on their hearts rather than their heads. They are buying a dream, and it will take an awful lot to turn that dream into a nightmare.


Purchasers buy with their hearts, not their heads... and only a fatal flaw will make them walk away.’


The result of this is inevitably a


dissatisfied consumer, and one who is looking for someone to blame for these unexpected bills. But who to blame? The Lender’s Valuer who produced the


mortgage valuation? Yes, they often do, but most purchasers do not understand that the report is carried out for the lender not the borrower, and it is a valuation, not a survey. The Lender then, for not telling them to


get an independent report? Well actually they do, or the mortgage adviser does. But this is often dealt with as almost a throw- away line as part of the far wider application process and the vast amount of information that the applicant has to receive to satisfy FSA requirements and to “treat the customer fairly”. Themselves, for not having sought out


that advice? Possibly, but with so much going on during this emotional and time- consuming process, and because the heart rules the head when it comes to home- buying decisions, there is often an assumption that ‘it will be alright’. Their conveyancer? Yes, he has an


obligation, under the rules contained in the CML Lenders Handbook, to advice their client to seek independent advice on condition before committing to purchase. But, rather like the discussion with the mortgage adviser, there is a lot for the consumer to take in, and the suggestion


that they should go out, probably at a fairly late stage in the process, to commission another report and incur additional cost, is often skirted over and ignored. The estate agent? Perversely the agent


will often be seen as a villain here, in not telling the buyer to go and seek independent advice. We all know that many customers assume, wrongly, that the estate agent is acting in their best interest, rather than in the interests of those of his or her client – the vendor – who is, after all, the one who is paying the bill. There is also an underlying concern on


the part of many of the above agencies that, by encouraging the purchaser to obtain a report, they might be putting the purchase, and therefore their commission, at risk. But there are thing happening in the


market that could affect the status quo, and increase the take-up of such reports. Firstly, a number of lenders are


considering separation of valuation from condition reporting, and releasing applicant details to panel valuers to enable them to market condition reports. Also, conveyancers are becoming


increasingly challenged on whether, by not more robustly following the CML requirements pushing their clients to seek independent advice, they may be in breach of the ‘treating customer fairly’ (tcf) obligations. Because there is now an expanding range


The reality is that: Buyers want to buy Only a ‘fatal flaw’ will make them walk away Therefore the worst-case scenario is renegotiation of the price. This potentially presents opportunities for contractor referrals to assess the true cost of reported defects By acting as ‘honest broker’ in advising a buyer to seek appropriate independent advice before buying, the agent is building a trusted relationship with both parties, which potentially leads to further recommendations and instructions As a greater proportion of buyers start to require independent advice, it is surely better from the agent’s perspective that they are able to manage the process by providing referrals to trusted professionals operating in their area with whom they can rationally discuss the content and implications of a report, rather than taking pot-luck on the outcome of a report from an unknown source


The RICS Home Surveys Suite offers a


range of reports designed to provide an appropriate level of advice depending on the customer’s needs and the age and type of property. All are designed to be objective and balanced, using a ‘traffic light’ flagging system to allow clients prioritise condition issues. These reports will also cover issues around risk, both to the property and to occupiers, and provide information to assist legal advisers to make appropriate enquiries. Properly managed, agents have nothing


to fear from purchasers being properly informed about the home they are intending to buy and, particularly in the light of forthcoming OFT Guidance on the Consumer Protection Regulations, are actually covering their own responsibilities in terms of their duty of care to that purchaser, who may one day come back to you as a seller.


PROPERTYdrum JULY 2012 21


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