In Scotland, from 1st December 2008, it became a legal requirement to have a Home Report for any home being marketed and sold. In many way, Home Reports have simplified and clarified the buying and selling process, helping the seller know better the property they are selling, and of course the buyer, who is, in short, better informed to make a decision about a prospective property purchase. A Home Report is essentially an information pack, prepared by a chartered surveyor and paid for by the property seller. Home Reports consist of three parts, (covered in more detail below):
- a single survey,
- an energy performance certificate and,
- a property questionnaire
Additionally, although this is not a legal requirement, some reports will contain a mortgage valuation report as well, as it conveys transparency to buyers giving them confidence when making a purchase.
In short, the purpose of a Home Report is to provide the potential buyer with upfront information about the condition of the property, enabling them to make an informed decision. They are available at no cost to the potential buyer through the seller’s estate agent.
It is important to note that Home Reports are valid for 12 weeks from the date the property is put on the market.
Rooks are proud to have an established relationship with Graham + Sibblad, a RICS registered charter surveyor, who we can instruct on your behalf to prepare the Home Report, should we be your sales agent. Alternatively, should you choose to arrange the Home Report yourself, and we will to provide as much or as little support as you require.
The Single Survey gives sellers detailed information about the condition and value of a home before it is marketed for sale. It also gives buyers better information about the condition and value of a home before they make an offer to purchase.
The Single Survey includes an accessibility audit to potential buyers. This information will benefit parents with young children and older people, as well as disabled people.
Energy Performance Certificate
The Energy Performance Certificate gives a home’s energy efficiency rating (A to G) and its environmental impact in terms of carbon dioxide emissions.
It recommends ways to improve the building’s energy efficiency and gives contact details for further advice and information about how to make a home more energy efficient and save fuel costs. This Energy Report helps home buyers to make ‘green’ choices, by comparing energy costs between homes and giving practical advice to reduce carbon emissions and save on energy bills.
The Property Questionnaire contains information for home buyers, solicitors and surveyors.
It would include, for example: a home’s council tax band, parking facilities, factoring arrangements, any local authority notices that affect it and alterations that have been made to the home.
This information will be useful for buyers before they decide whether to submit an offer to purchase a home. The Property Questionnaire will also reduce the risk of delay and difficulties in conveyancing, so should be seen as very much a positive component in the sale of your property.
Mortgage Valuation Report
The mortgage Valuation Report (MVR), is sometimes included in the Home Report for the buyer to take to their mortgage lender.
Do all residential properties require a Home Report?
Although you should always get professional guidance from a RICS registered charter surveyor, there are some exemptions, which for general guidance are listed as follows:
- New housing – New housing includes homes that may be sold ‘off-plan’ to the first purchaser or sold to the first occupier. Any subsequent sale of a home will not be exempt even if it has a certificate from, for example, the National House-Building Council (NHBC).
- Newly converted premises – This means a property which is being, or has been, converted to a home if it has not previously been used in its converted state.
- ‘Right to Buy’ homes – As the sale of a home to a tenant under the ‘Right to Buy’ does not involve marketing, the duty to provide a Home Report does not apply. A separate package of information is being developed for Right to Buy purchasers.
- Seasonal and holiday accommodation – This exception refers to seasonal and holiday accommodation (as defined in planning legislation), which only has permission to be used for less than 11 months in any year. It does not include second homes or holiday cottages that could be used all year if the owner so chose.
- A portfolio of residential properties – This means a home which is to be sold with one or more other homes and where it is clear from the manner in which the homes are marketed that the seller does not intend to accept an offer to buy one of those homes in isolation from another. Sales of a portfolio of residential properties are considered to be commercial transactions. A home which is ancillary to a principal property may include, for example a ‘granny flat’, or butler’s cottage that is attached to a larger property on a country estate.
- ‘Mixed sales’ – This occurs where a home is sold with one or more non-residential properties (provided it is clear that the seller does not intend to consider an offer to buy the home separately from the non-residential property). This might include farmhouses that are part of a working farm, or flats above shops or pubs that are sold with the shop or pub.
- Dual use of a dwelling house – This describes the situation where the home is, or forms part of, a property most recently used for both residential and non-residential purposes, such as a commercial studio where the owner also lives in the home.
- Unsafe properties – Unsafe properties are evidently in a condition that poses a serious risk to the health or safety of occupants or visitors, or where the way the home is marketed suggests it is unsuitable for occupation in that condition. There is little point in a condition survey being undertaken on a home that is unfit for occupation in any case, and is being advertised as such.
- Properties to be demolished – There is an exception for homes to be demolished where it is clear the home is suitable for demolition and all the necessary consents have been obtained for demolition and consents obtained for redevelopment. There is little point in a condition survey being undertaken on a home that is to be demolished and is being advertised as a development site.
For information on the above and other aspects of the Home Report, please click here to contact our property consultants at Rooks. Additionally, more detailed guidance can be found on the Royal Institute of Chartered Surveyors (RICS) website and the Scottish Government website.