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The Single Survey Pilot scheme was finally launched in Scotland on Wednesday 14th July. The idea of Sellers Surveys has been highly publicised and the concept of a single survey has been pushed by the Scottish Executive as a way of improving the information available to house purchasers in Scotland. Every year it is estimated that around £9 million is spent on house surveys in Scotland which do not lead to a sale. In response to that a recent survey found that four out of five house buyers were in favour of introducing this new scheme although it appears that some lending institutions, solicitors and surveyors are not so sure that this is the best way forward. Royal Institution of Chartered Surveyors Scotland Deputy Director Graham Hartley has stated recently “We certainly would welcome anything that makes consumers take a more informed decision when making the biggest decision of their lives.” But went on in a recent radio interview with the BBC to state “One of the possible downfalls or pitfalls of the product that we see is that the buyer will not be able to discuss any detail of the particular survey with the surveyor. That’s something that the buyer will have to think about very carefully because, depending on what the report says, you may want to ask the surveyor a number of questions regarding the report and you won’t be able to do that.” The council of mortgage lenders in Scotland said the scheme could help establish more realistic pricing, but warned that it might also increase transaction costs or have other unforeseen effects. Four pilot areas have been selected:
The exact boundaries of the pilot areas can be found at the Single Survey Website. These areas have been selected as it is believed that they display different characteristics, eg areas of high and low demand, high and low prices and urban and rural areas. It is also believed that together with the length of the pilot this should allow a proper evaluation of the Single Survey to be undertaken. The Single Survey is designed to tackle what are believed to be the three important weaknesses in the current house buying and selling process in Scotland. These are: 1. The current reliance of most house purchasers on Scheme 1 valuations which provide only limited information on the condition of the property; 2. The encouragement which the existing system gives to multiple valuations which can result in abortive costs for house buyers and a disinclination to commission the more detailed, but more costly, surveys in advance of purchase; 3. The setting of upset prices at an artificially low level by sellers in order to stimulate the interest in the property, which can result in prospective buyers spending money on an unnecessary survey or valuation report for a property outside of their price range. The new Single Survey will be based on the current Homebuyers report and will contain the following information:
Sellers in the proposed pilot areas who wish to take part will advise their agent, normally a solicitor or estate agent who will then instruct on their behalf a surveyor to prepare a Single Survey report. The surveyor carrying out the report has to be a member of the RICS. The marketing materials for the property will state that a Single Survey will be available and that the sellers agent will deliver it to prospective buyers. Prospective buyers and their agents will receive a copy of the report when they note their interest in purchasing the property. The successful buyer will reimburse the seller for the cost of the survey. In terms of the engagement letter which will be entered into when the single survey is instructed surveyors acknowledge that their duty of skill, care and diligence in relation to the report is owed to the seller and the eventual purchaser of the property. The Single Survey scheme will operate through a web based system. Surveyors, solicitors and estate agents who have registered to participate in the scheme will be able to access the website. Surveyors will upload completed surveys onto the system and seller’s agents will be able to access the password protected surveys on line, record details of potential buyers and distribute named copies to them. It should be stressed that the scheme is voluntary and selling agents will ask and encourage all sellers in their area to take part, with a full evaluation of the pilot being carried out by July next year. In introducing the Single Survey the Scottish Executive is hoping to make the whole process of home buying more transparent. Ewen Sparks : e.sparks@shepherd.co.uk |