Since 1st December 2008, a Home Report has been required for almost all residential property brought to the market in Scotland. Provision was made for Home Reports through the Housing (Scotland) Act 2006.
Each Home Report consists of three components:-
(1) The Single Survey which is conducted by a Chartered Surveyor and includes a condition report, a valuation and a generic Mortgage Valution Report. The Single Survey also contains an accessibility report.
(2) An Energy Report – this is also provided by a Chartered Surveyor and details the energy efficiency of the dwellinghouse in question and lists potential improvements.
(3) The Property Questionnaire – this is completed by the seller who provides information about the property covering items such as Council Tax banding, alterations and any guarantees for past specialist treatment works.
The purpose of a Home Report
It is believed that the Home Report was seen as a means of improving the condition of houses for sale in the private sector in Scotland. Home Reports were also introduced in order to improve information about the condition of a property and subsequently to encourage vendors to undertake maintenance works.
To address the problem of multiple surveys and valuations that were abundant during the peak market where a number of potential purchasers obtained copy reports and often missed out on closing dates.
To tackle the problems created by properties being exposed to the market at artificially “offers over” low asking prices which often previously resulted in purchasers bidding for properties at closing dates which they could not afford and completed sales were significantly higher than the asking price.
Most of the Home Reports are instructed by the selling agent although the seller is able to instruct the Surveyor direct and then choose whichever selling agent he or she or decides to sell with. There are different websites and packages for providing the Home Report for prospective purchasers although we provide most of our Home Reports through Onesurvey Ltd at www.onesurvey.org
We also undertake a number of Home Reports for local lawyers who sell through the GSPC (Glasgow Solicitors Property Centre).
Completing the Home Report
The Single Survey is completed by the Chartered Surveyor and the seller is given an initial draft copy of the report which is then read by the seller to ensure that they are happy with its content with regard to accuracy. The report is then approved by the seller if there are no changes required.
It is a legal requirement that the Property Questionnaire is completed by the seller. It can either be completed online or by hard copy. The Property Questionnaire covers matters such as Council Tax banding, utility suppliers and if there have been any alterations carried out in the past.
This is completed by the Surveyor by collating data at the date of inspection and inputting this into an Elmhurst form online; the end product being an Energy Performance Certificate which is then registered.
All three of these documents must be completed prior the Home Report being made “live” and being exposed to the open market. Legislation specifies that a copy of the Home Report must be made available to a prospective purchaser within 9 days.
How much do Home Reports cost?
The cost of a Home Report varies depending on the valuation of the house, its location and if there are any additional elements which form part of the title eg additional land or outbuildings. A farmhouse with additional land and outbuildings would take longer to complete than a Home Report inspection over a traditional 3 bedroomed semi-detached house.
The main benefit of a Home Report is that information on the valuation, condition and energy efficiency of a property is known at the outset so a prospective purchaser can weigh up the pros and cons of a house purchase prior to conclusion of missives.
Home Report FAQ
The most common questions asked while undertaking Home Reports in Ayr and indeed the Ayrshire market are:-
(a) How long does the Home Report last?
A number of people believe that the Home Report has to be “replaced” (renewed) every 3 months although this is not the case. It only needs updated after 3 months if the property is sold. This is usually required by the lender and could be at a point 6 months or a year down the line. It does not need to be “refreshed” every 3 months. The cost of the replacement report is significantly lower than the original Home Report and is only a “replacement fee”, usually £150+VAT.
(b) Do I need a Home Report if I am selling my property privately?
A Home Report is not required legally if the property is being sold “off the market” and it has not been actively marketed. The most common scenario is where there is a family connected sale. A Home Report is not required by law and it is common practice to obtain a standard Valuation Report in order to ascertain the fair market value of the property in question. However, if loan finance is to be arranged, then a number of lenders will only accept a transcription report prepared from a Home Report and, if not, they may often instruct their own valuer depending on which Building Society or Bank is arranging the mortgage.
The Ayrshire Property Market
The current property market in Ayrshire is strong as mortgage brokers have reported application restrictions have eased somewhat compared with 12 months ago. As a consequence of this, we are seeing an increased number of properties for sale on the open market. Activity continues to be strongest up to and around mid price range properties. The Ayr and Prestwick market is still robust and a number of properties are now selling at closing dates, securing sale prices over the asking price. In Ayr, the higher value properties are marginally slower due to the higher LBTT tax rates which is pricing some of the buyers out of the market.
There is currently a good level of demand for property within the Troon area. This has been particularly evident for properties listed between £100,000 and £250,000. On speaking to local Estate Agents in Troon, a common problem appears to be lack of stock coming to the market and there is a clear lack of bungalows in good locations which continue to attract significant interest from clients looking to downsize. Mactaggart & Mickel are currently building property at Braemore Wood and Stewart Milne and Bellway are constructing a number of properties at the Earls Green site in Barassie. There appears to be some demand from people within the Troon area who are “trading up” to these properties although a large proportion of purchasers are being attracted from Glasgow and the surrounding towns of Kilmarnock, Prestwick and Troon.
There is still demand for properties in the surrounding villages, providing they are priced realistically and are not exposed to the market at over inflated asking prices.
Instructing a Home Report
The Ayr Office provides Home Report coverage over Ayrshire, covering as far south as Girvan, Ballantrae and Barr and as far east as Muirkirk, New Cumnock and surrounding areas. The majority of Home Reports are undertaken in Ayr, Prestwick , Troon and the surrounding villages. Our postcode coverage is KA5-10, 18, 19 and 26.
If further advice is required with regard to Home Reports, or you wish to instruct a Home Report in Ayr and the surrounding areas, then please do not hesitate to contact the Ayr Office:
Tel 01292 260 509