DEBUNKING HOME REPORT MYTHS

HomeReal Estate

  • Author Andrew Mackenzie
  • Published September 5, 2023
  • Word count 876

With only a few exceptions, a Home Report is required by law in Scotland if you are planning to sell your house. As the seller or selling agent, it is your responsibility to make a Home Report available to prospective buyers within nine days of requesting it. Note that a Home Report can only be produced by a Chartered Surveyor.

Newly built homes and a house bought by a private individual before going on the market are two of the limited exceptions when a Home Report may not be required. Please also be mindful that in this article I am wholly referring to the Scottish property market, for there are different rules and regulations in England & Wales.

Background to The Home Report

Home Reports have been a legal requirement in Scotland since 1 December 2008, following the introduction of the Housing (Scotland) Act 2006 and associated regulations. As a professional Chartered Surveyor, over the years I’ve come across various opinions about the value or otherwise of the Home Report.

In my professional opinion, the Home Report is far more than simply a legal necessity. It can be an invaluable guide to the buyer and seller alike. Commissioned by the seller, it provides prospective buyers with detailed professional information about the condition and value of the property right at the start of the transaction. It also gives sellers a realistic expectation of the condition and value of their property and allows buyers to make an informed decision before putting in an offer – and with an idea of what their offer should be.

It's this latter aspect around the question of valuation that in my opinion has created the most debate around the Home Report. However, it should be remembered that before its introduction, prospective buyers had the unwelcome inconvenience and cost of paying for multiple surveys and valuations. Undoubtedly, in this regard, the Home Report has simplified the process.

However, I agree with other commentators in our market that the Home Report has scope to be further improved and I will return specifically to the point about valuation. Let’s first remind ourselves of the three parts of the Home Report that are legally required in Scotland.

Legal necessities

Single Survey

The single survey provides a detailed report about the condition and value of a home before it's marketed for sale. The single survey also includes an accessibility audit of every home for sale in Scotland, which is particularly helpful to families with young children, older buyers and people with a disability.

Keep in mind that though your flat or property may have a fantastic view – perhaps of a famous landmark or across a stretch of water or towards the hills – this (rightly or wrongly) is not factored into the Home Report. However, it will often be referenced within the marketing information compiled for the property sale.

Energy Report

The energy report – including the Energy Performance Certificate (EPC) provides details of the home’s energy efficiency rating and its environmental impact in terms of carbon dioxide emissions. The energy report – with its A-G rating - will also contain recommendations on how a home’s energy efficiency can be improved, allowing you as the buyer of a property to make greener choices and potentially save on energy costs.

Investing in energy saving measures

At a time of the ongoing energy crisis and a greater awareness of the need to reduce our carbon footprint, as the seller you may be tempted to undertake some energy saving measures in the hope of improving your EPC report within the Home Report. Certainly, such measures may improve your rating and reduce your heating bills. However, I’d strongly suggest doing a cost v benefit analysis before undertaking a raft of energy saving measures, for in the Home Report process the surveyor is only focused on your EPC.

Property Questionnaire

Completed by the seller, this questionnaire contains information for home buyers such as council tax band, parking facilities, factoring arrangements and any local authority notices. The property questionnaire will help reduce the risk of delay and difficulties in conveyancing by asking the seller to provide information on any alterations to the property early in the process, allowing more time for the necessary documentation to be prepared.

It is the responsibility of the seller or the seller’s agent to commission the documents needed for the Home Report. As I said at the outset of this article, legally, a copy of these must be provided within nine working days following a request from a prospective buyer or buyer’s agent. Where a local trading standards officer decides that a seller or sellers’ agent may be in breach of their duties to provide or to possess the Home Report documents to a potential purchaser, a penalty charge notice of five hundred pounds may be issued.

Documents in the home report should be no more than 12 weeks old when the property is placed on the market. The legislation does not impose a set shelf life or validity period for any of the Home Report documents. Decisions as to whether any aspects of the home report need to be updated or ‘refreshed’ will depend on the individual circumstances and are for sellers, buyers and their professional advisers to make.

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