Home Reports were introduced in 2008 by the Housing (Scotland) Act 2006. Generally, anyone selling a house in Scotland has to provide potential buyers with a Home Report. The purpose of the Home Report is to give those considering buying the property a clearer picture of what they may be purchasing early in the process. In this post, we look at what is covered in the Home Report, who is liable for errors, and how important the Home Report is to the conveyancing process.
What is included in a Home Report?
The Home Report is designed to give the buyer a general overview of the condition of the property, how energy efficient the property is and the value of the property. Three documents are included in the Home Report, as follows:
The Single Survey
The Single Survey is a chartered surveyor's assessment and valuation of the property. This document will include details of the condition of the property and whether repairs are required. This part of the Home Report will highlight the most common defects in any property, and whether the property in question has any of these defects. However, the Single Survey is a superficial inspection of the property, it is non-invasive, and as a result, it will not reveal every defect. The Single Survey generally will not pick up things such as asbestos, damp or dry rot where they are not visible. In comparison, a Full Structural Survey will provide in-depth information and detailed advice on what should be repaired.
The Property Questionnaire
The Property Questionnaire will be completed by the seller and is designed to give practical information and answer many of the questions potential buyers have about a property. The questionnaire usually covers council tax, property alterations, specialist work, guarantees and notices, and any previous structural damage.
One of the most significant difficulties with the Property Questionnaire is that it relies on the seller completing it accurately and honestly. Furthermore, some of the questions as the seller, whether they are 'aware' of a problem, which can be subjective.
An Energy Performance Certificate (EPC)
The Energy Performance Certificate (EPC) is a surveyor's assessment of how energy efficient the property is.
What else might the Home Report cover?
There may be additional elements to a home report which can help buyers to decide on a property, including:
Valuations and local sale prices – Chartered surveyors provide an accurate valuation of the property. However, the sale price of a property is often dictated by the state of the local market and how much interest there is in the property.
Valuations and mortgages – Many Home Reports also include a Generic Mortgage Valuation Report (GMVR). However, lenders have their own risk assessments and policies so they may not accept the GMVR included in the Home Report.
Who is liable for the information in the Home Report?
One of the most common questions we get from clients is 'if the Home Report is inaccurate, or misses an important defect, who is liable?'
Unfortunately, this is a difficult question to answer - it really depends on the circumstances. Chartered Surveyors have a professional responsibility to report accurately and may be liable to pay damages if they fall short of exercising this responsibility with skill and care. However, Single Surveys are not designed to discover every possible defect in a property, and in a single survey, a surveyor is not obligated to provide extensive detail.
Whether a seller will be liable for any inaccurate statements they provide in the Property Questionnaire is unclear. This is dealt with under the law of negligence and will depend on the circumstances.
Contact our Conveyancing Solicitors, Lanark, Barrhead, East Kilbride, Neilson & Newton Mearns, Scotland
Located in the heart of Lanarkshire, Davidson & Shirley are ideally placed to handle every aspect of buying or selling a home. We principally undertake property-related work throughout North Lanarkshire, South Lanarkshire, Ayrshire and Glasgow, and often further afield within Scotland. No matter where you are based, we have the expertise to help. Please contact us on 01555 662576 or fill out our online enquiry form for more information.