Common Problems when Selling a House
Planning and Building Regulation Problems
If you have carried out any major works to your property during your time there, you will need to ensure that you have all the necessary documentation in order. If the building work required planning consent, your solicitor will need a copy of the documentation. If you cannot find it, a copy can be obtained from your local council.
Even if the building work did not require planning permission, it will still need to have building regulation approval, i.e. a certificate from the local council stating that the building work complies with all relevant regulations.
If you do not have such a certificate you must proceed with the utmost caution. Even an informal telephone conversation with the council might trigger an inspection which could result in you being ordered to demolish the extension. Your solicitor will usually be able to advise you regarding the best way forward. In some cases the best solution is to pay an independent architect to check whether the building work complies with regulations. If it does, you can apply for a certificate retrospectively.
Adverse Survey Reports
A great many sales fall through because the building society valuer finds defects with the property and/or down-values the property on survey.
Why does it happen?
The valuer is retained by the mortgage lender and his role is to ensure that the property is satisfactory security for the size of the loan that is to be advanced. Because he is retained by the lender, the surveyor will err on the side of caution when valuing a property. The consequence is that the mortgage valuation can often be 5-10% lower than the sale price that has been agreed.
What can be done to pre-empt the problem?
The best way to avoid the problems caused by a down valuation is to prevent it from happening in the first place. There is a great deal that you can do to achieve this:
1. Choose the lending source
Some banks and building societies have a reputation for using over-cautious valuers. Your estate agent will know which they are, locally. If your purchaser is intending to apply to one of these lending sources, you should ask your agent to try to dissuade them.
2. Choose the surveyor
Some building societies employ their own full-time salaried valuers but most still instruct an independent local surveyor. Each local surveyor will take a different view of property values and most towns have at least one who has a reputation for down-valuing. Your goal must be to prevent this surveyor from valuing your property.
3. Prepare the house for the survey appointment
Surveyors are human too, and a well-presented house will often be valued at a higher price than an untidy one. You should prepare for the surveyor's appointment in exactly the same way as you would prepare for any other viewing.
4. Show the house to best advantage
The surveyor should be shown around the house in exactly the same way as any other purchaser. First impressions count for a lot and a local surveyor will probably have decided what value to put on the property within a few minutes of arrival.
When the market is poor gazundering is a common problem. A vendor is 'gazundered' when the buyer reduces his offer, without good reason, shortly before exchange of contracts is due to take place.
The buyer who tries this tactic is banking on the fact that the financial and emotional costs to you of pulling out of the sale at such a late stage, will exceed the value of the reduction that he has asked for. When the property market is poor, buyers often get away with it. The following suggestions will help you to limit the damage if your purchaser tries to gazunder you:
1. Negotiate via the agent
You will probably be very angry with the buyer for trying to gazunder you and this anger will seriously reduce your ability to negotiate effectively. Further negotiations really must therefore be conducted via the estate agent.
2. Ask for reasons
Ask the buyer why he has reduced his offer at such a late stage. The buyer's embarrassment about the situation will be increased if he is forced to admit that he has no reason to ask for a price reduction and that he's just trying it on.
3. Re-justify the price
Use comparable evidence to justify that the property is worth the original price that was agreed.