Lenders are increasingly deferring to AVMs, particularly on lower loan to value (LTV) cases and often they do not even offer buyers the opportunity to upgrade to a physical inspection of the property. Consequently, my experience of the market is that on half of valuations, nobody even goes through the front door to review the property.
This might seem advantageous for brokers, who see physical valuations as a hold-up in the mortgage process, but that is not necessarily the case.
If nobody is going into the property, who is going to point out that walls have been removed or a loft converted without meeting building regulations?
Or pick up on areas of poor condition that could be costly to rectify?
A lender might be happy to take on the risk, based on an AVM, but your client could be taking on a liability that they might not be able to afford.
In an environment of low transaction volumes, there is greater emphasis on client retention by delivering exceptional customer experience and also maximising conversions.
From a customer experience perspective, brokers are increasingly offering clients more holistic advice as part of the home buying process, including protection and general insurance.
If you are not also discussing the value of a physical inspection of a property, you could be letting your client down and may even leave yourself open to potential claims in the future from clients who ask: “Why didn’t you tell me that I needed to have a survey done?”
Addressing whether or not a client should have a survey early in the process could even help to improve conversions.
Purchasers are currently required to confirm that a survey has been at least considered when they sign the title.
The problem is that this is at the end of the process and can cause additional delays if, at this stage, they do decide they want the property to undergo a full inspection.
So, rather than wait for the tail end of a transaction when delays can be critical, raising the issue at day one can provide buyers with more confidence and help the process to run more smoothly.
Not every buyer will want a physical inspection, but at least by talking about the options early on in the process, you can demonstrate that you are working in the best interests of your client and protecting their investment.