Home buying - what lies beneath?

Armed with your deposit, built up from savings or donated by kind relations, and a mortgage approval in principle from your lender, you're ready to set out on the hunt for your perfect home. Whether you've bought a house before, or are a first-time buyer, it doesn't make much difference - the home buying process can be a fraught one.

No matter how many times you've been through the mortgage process, there's much to learn. It's worth treading carefully through the minefield of house purchase because getting it wrong can have a substantial adverse affect on your future wealth.

Before you set out, you can save yourself time by writing out a list of the features you want from your new home and use this as a scorecard to compare properties. Think about the advantages of buying a new property - you get a 10-year guarantee under the National House-Building Council's Buildmark scheme. Start your search online and be fussy until you find homes that are worth visiting in person.

Location, location, location

You know the old adage, so think about transport including new links, schools, shops and new amenities. If high street retailers are moving in - it's a good sign. Ask about the age of the property and any modifications, extensions and repairs carried out.

Talk to the neighbours about what's happening in the area and the type of people that live nearby. Estate agents always recommend that you visit the property at least three times - both during the day and night - to get a feel for a place.

Once you have found your dream home, the next step is the negotiating stage over price. You have to remember that if you dealing with an estate agent, they represent the seller and their main interest is getting the best possible price. Before you start chucking numbers around, try and find out what similar properties in the area sold for.

Pay for a proper survey

As bricks and mortar are likely to be the most expensive goods you'll buy in your lifetime, you'll need to know absolutely everything about it. After all, you wouldn't buy a car or expensive jewellery without checking out its credentials so why buy your home without a proper survey? You might find this surprising but only one in five home buyers takes the time to get any kind of survey conducted, according to the Royal Institution of Chartered Surveyors (RICS).

Many confuse the lender's valuation as being a survey. Although lenders charge about £200 for this, they use it to confirm the value of the property and the valuer doesn't look for faults such as structural defects. There are two types of surveys - the home buyer's report and a full structural survey. The home buyer's report is more extensive than a valuation but has its limitations. Surveyors only investigate the parts of the property that they can easy access but will recommend further investigation if they suspect there are serious problems.

Without a full structural survey what lies lurking beneath the wallpaper, the floor boards, joists and the loft will remain a mystery - that is until you re-decorate. RICS said that if you are buying a pre-Victorian property or an unusual home you should get a full structural survey, which costs between £400 and £1,000. You can find a directory of surveyors on the RICS' website.

Knowing what you are buying, warts and all, saves you money in the long run. First of all, you can use your knowledge to increase your bargaining power with the vendor. And secondly, knowing what you are buying cuts out surprises and helps you budget for repairs, re-modelling and re-decoration more accurately.

22 July 2005 © Moneyextra.com

back

Moneyextra.com recommends you should consider taking independent financial advice before acting on any article. Please contact us for help with your individual circumstances if any assistance is required.