Valuers are not always brokers’ favourite people. Actually, that’s not quite fair, brokers being results-led professionals can get frustrated when a valuation doesn’t allow the applicant to access the terms that had originally been envisaged.
A broker friend (yes I do have some) was also pretty candid recently when I pointed out that of all the professionals involved in a purchase transaction brokers were the least likely to suggest that applicants obtain a private survey.
Firstly the facts. Overall, only one in five purchasers currently obtain their own advice. According to the Royal Institution of Chartered Surveyors, on average homeowners spend £5,750 on a property after picking up the keys. This is often as repairs were not previously diagnosed due to a lack of survey.
At least some applicants don’t do so in the mistaken belief that the mortgage valuation covers them. The reality is that this brief report is not for the applicants’ benefit and is not intended to identify matters of interest to a purchaser.
My friend confirmed that part of his advice was indeed to discuss surveys but also to flag the expense and that on some level there was a consideration that an adverse survey could deter a purchase and kill the transaction. That’s an understandable concern but if a longer-term view is taken it’s unlikely that customers will thank anybody who fails to prevent such a painful later expenditure.
More pragmatically, other professionals in the process are increasingly recognising the need to provide appropriate advice and also the potential for commercial benefit from referral fees. Lenders are required by regulation to recommend that purchase applicants take separate advice, and a growing number of solicitors, agency groups and online portals are raising the profile of this element of the transaction. With strong personal relationships, brokers are actually pretty well positioned to do this better than any other party. But, if they choose not to remember there is a chance that somebody else will.