The New RICS HomeBuyer Report 3rd Edition. Barry Hall FRICS MCIArb Chairman of the RICS Residential Survey & Valuation Working Group

Transcription

1 The New RICS HomeBuyer Report 3rd Edition Barry Hall FRICS MCIArb Chairman of the RICS Residential Survey & Valuation Working Group 1

2 The New RICS HomeBuyer Report Changing from the HSV Read the technical advice (the new Practice Note) Understand the structure of the new report Learn how to apply condition ratings Review how to express yourself in the report Decide how you will produce your reports (Quest, Survey Writer, PDF) 2

3 The New RICS HomeBuyer Report Hints and help The timetable for change The headings and sections The main changes Using condition ratings Where does objectivity stop? What advice should be included? Dealing with Section J Risks Services 3

4 THE HOMEBUYER REPORT The timetable for change New RICS HomeBuyer Report (HBR) PDF version introduced July Survey Writer on-line version October Home Buyer Survey and Valuation (HSV) to be withdrawn 31 March 2010 Scotland edition due later this year to cover their requirements 4

5 THE HOMEBUYER REPORT The headings and sections Contents listed A to L and sections highlighted on each page (there are more headings): A Introduction to the Report B About the Inspection C Summary of Condition Ratings D About the property E Outside the property F Inside the property G Services 5

6 THE HOMEBUYER REPORT The headings and sections Contents listed A to L and sections highlighted on each page H Grounds (including shared areas for flats) I Issues for Legal Advisers J Risks K Valuation L Surveyor s Declaration 6

7 THE HOMEBUYER REPORT The main changes The report is elemental Longer with more headings Allows for the elements to be condition rated Promotes objective reporting Limits jargon and verbose reporting It sign posts the client to what needs attention 7

8 THE HOMEBUYER REPORT Uses condition ratings The main changes Sections E to G (and part of H) only Uses colour to draw the client s attention to what matters Allow defects to be ordered in importance Useful for applying standard paragraphs to speed up reporting The application can be tied to specific rules Encourages a degree of consistency in reporting 8

9 THE HOMEBUYER REPORT The main changes Introduces new headings/material The Recorded Energy Performance is stated (but not commented upon) at D Services are listed in a tick box and other energy sources can be listed (D) Windows (E5) and outside doors (E6) are reported separately Conservatories & porches have a separate heading (E7) Bathroom fittings have their own heading (F8) Water heating is reported separately (G5) Garages are reported & condition rated (H1) Movement, timber, defects and dampness reported under Risks (J) 9

10 THE HOMEBUYER REPORT What has not changed It remains a Survey & Valuation The HomeBuyer is still a survey and not just a condition report Additional advice can be added after the rating It has a Summary and Overall Opinion to balance the objective reporting (C) There is a Valuation (K) so it will be subject to regulation and valuer registration It is still a licensed product for RICS members only 10

11 THE HOMEBUYER REPORT What has not changed It remains a Survey & Valuation There is still a dedicated Practice Note for guidance The Leasehold Property Advice Appendix is much the same Choosing between Surveys documentation remains Description of the RICS HomeBuyer Service is similar There are still Standard Terms of Engagement 11

12 THE HOMEBUYER REPORT Applying the Condition Ratings The condition ratings 1 No repair is currently needed. The property must be maintained in the normal way. 2 3 NI Defects that need repairing or replacing but are not considered to be either serious or urgent. The property must be maintained in the normal way. Defects which are serious and/or need to be repaired, replaced or investigated urgently. Not inspected 12

13 THE HOMEBUYER REPORT Applying the condition ratings Step One ASK: Is the element defective? YES/NO Remember that normal maintenance is to be anticipated and is not to be considered as a repair If NO then Condition Rating 1 applies. No repair is currently needed. The property must be maintained in the normal way. If YES then move to Step two. 1 13

14 THE HOMEBUYER REPORT Applying the Condition ratings Step Two ASK: aseries of questions, does the defect: Spoil the function of the element? Yes No Cause failure in other parts of the property? Yes No Affect structural integrity? Yes No Cause a safety hazard? Yes No Require urgent repair or replacement? Yes No Need further investigation? Yes No 14

15 THE HOMEBUYER REPORT Applying the Condition ratings Step two ASK a series of questions, does the defect: Spoil the function of the element? Cause failure in other parts of the property? Affect structural integrity? Cause a safety hazard? Require urgent repair or replacement? Need further investigation? No No No No No No If the answer to all is NO then Condition Rating 2 applies Defects that need repairing or replacing but are not considered to be either serious or urgent. The property must be maintained in the normal way. 2 15

16 THE HOMEBUYER REPORT Applying the Condition Ratings Step two ASK a series of questions, does the defect: Spoil the function of the element? Cause failure in other parts of the property? Affect structural integrity of the property? Cause a safety hazard? Yes Require urgent repair or replacement? Need further investigation? If the answer to one or more is YES then it is likely that Condition Rating 3 applies These are defects which are either serious and/or need to be repaired, replaced or investigated urgently. Yes Yes Yes Yes Yes 3 16

17 THE HOMEBUYER REPORT Applying the Condition Ratings Brought forward to the summary and colour coded as traffic lights Worst Condition ratings first

18 THE HOMEBUYER REPORT Applying the Condition Ratings Best Condition ratings last

19 THE HOMEBUYER REPORT Applying the Condition Ratings Dealing with multiple elements - Different roof coverings, or several chimney stacks of varying construction/condition - Worst rating ONLY is given priority and brought forward to the summary - the additional elements are give a rating in the text only eg. The rear kitchen chimney stack is of brick, with a clay chimney pot, and has been recently re-built (Condition Rating 1).

20 THE HOMEBUYER REPORT Applying the Condition Ratings Not Inspected This is used if it is not possible to inspect that part of the property which is normally inspected. Remember that you may be able to reach a conclusion over the condition from what you can see. Alternatively, you may consider it necessary to recommend a further investigation. NI 20

21 The HomeBuyer Report Report writing software Software producers will market a variety of report writing packages: However, surveyors will always be able to produce the reports using their own text and phrases without the use of specialist software: In these cases: The surveyor should use non-technical terms throughout wherever possible; Where technical terms are used, they should be restricted to those in the house diagram that will be included in the HBR pack. 21

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23 The HomeBuyer Report Writing your own text If you are not using a software package, the text in the comment boxes should be structured as follows: An objective, descriptive section. This will form the basis of the text used in the Property Report that will be developed later in the year, and; An advisory section. This is the added value of the HBR and provides the customer with advice on how to resolve the defects and deficiencies in broad terms. 23

24 The HomeBuyer Report The descriptive section Several different parts: Describe the construction and location of the element; Describe the problem in broad terms that includes: The actual part that has something wrong with it (the slates, the flat roof covering, the brickwork, etc); What is wrong with it (broken, leaking, missing, rotten, etc); The condition rating category you have chosen. The paragraph produced will form the basis of the forthcoming Property Report. 24

25 The HomeBuyer Report Writing the Condition Rating Describe the element and its construction Describe its condition Apply the Condition Rating 25

26 The HomeBuyer report Writing the advisory section This part provides the customer advice on what should be done about the identified problems: It is still an 'economical' and 'cost effective' product so the section should be as short as possible; However, this part provides the added value of the HBR and so it must offer useful information; This is where objectivity ends The following guidance may be helpful. 26

27 The HomeBuyer Report The advisory section the guidance This should put the customer in the right ball-park and highlight other factors that may affect the solution: It must stop well short of a specification but sketch out the extent of the work that needs to be undertaken; Include other factors that will help the client understand the full extent of the work that will be required to solve the problem. For example: The impact of listed building status and the use of traditional building techniques; The need to obtain a party wall and other legal agreements; The general cost implications of factors like access equipment for working at height, implications of possible asbestos content, etc. 27

28 The HomeBuyer Report Identifying Risks & Hazards The template I have provided will help in considering identified hazards: Consider Do you judge it a potential safety hazard? Then If so, is it a direct threat to the user of the property? Finally Does it impact on the condition of the element or not? If it DOES then it will affect your decision on rating the condition of the element 28

29 The HomeBuyer Report Identifying Risks & Hazards Where should it be reported in Section J (if at all)? - As a risk to the building?j1 - As a risk to the ground? J2 - As a risk to people? J3 - As an other risk? J4 Is there an impact on Market Value? - If so then this should be reported at K 29

30 The HomeBuyer Report Dealing with services Electricity G1 - Advice & a safety warning written into the hard text - If there is no recent report then I suggest you apply CR3 and also report at J 3 Gas/Oil G2 - Advice & a safety warning written into the hard text - If there is no recent report then i suggest you apply CR3 and also report at J3 Remember Services are not tested, but visual defects are reported 30

31 The HomeBuyer Report What is available to help you? The new Practice Note - can be downloaded free isurv updated - a dedicated section to the HomeBuyer 31

32 The HomeBuyer Report What is available to help you? RICS Survey Writer - accessed on-line - pay as you go - manage job files - record inspection data - produce draft reports - deliver to clients securely The RICS Survey Writer Provides the complete collection of standard phrases used in the Survey Writer software; Over 1000 phrases written especially for the HBR has been edited by Tom Littler, who has many years of experience of producing home buyer reports. 32

33 The HomeBuyer Report What is available to help you? The Surveyors Guide to the HomeBuyer Report - RICS Books - written by Phil Parnham - case studies - illustrated case studies - sample site notes - sample report The Surveyor s guide to the new RICS HomeBuyer Report To be published in October by RICS Books; It provides a practical application of the Practice Notes; Provides a clear focus on condition rating and report writing; Includes many illustrated case studies; Appendices include three different types of site notes and a completed sample report 33

34 The HomeBuyer Report What is available to help you? HSV 2005 scheme ends 31 March 2010 Current licence transferable to HBR scheme Scheme includes HBR form, Description of service (T&C), Leasehold appendix, Choosing between Surveys Free PDF template 34

35 The New RICS HomeBuyer Report 3rd Edition Thank you for listening... any questions? Barry Hall FRICS MCIArb Chairman of the RICS Residential Survey & Valuation Working Group 35