Property Surveys - When and Why

There are a number of types of survey that people can request and need for particular situations. An urban myth seems to exist to the effect that there is no such thing as a surveyor in Spain. This is untrue as the buying process is really not very different from buying a property anywhere else in that everything is negotiable. I have set out below the various different types of survey available, and the reasons for requesting a particular survey.

Mortgage Survey - this is carried out on behalf of a bank or other mortgage lender. These surveys, though paid for by the borrower, really have the lender as the client and are merely to ensure that the lender’s money is safe. A mortgage survey in Spain, unless it is carried out on behalf of a UK or Gibraltarian bank, has to be carried out by a tasador acting on behalf of one of the Sociedades de Tasación approved by the Bank of Spain. These companies have to place a substantial ‘bond’ with the central Bank, which I understand to be a kind of indemnity fund where lenders can be compensated in case of gross error by the tasadores. This central control can lead to the Sociedades being used to influence the market such as recently where they were instructed to undervalue in an attempt to reduce mortgage lending and slow the rise in values. So their valuations deliberately may not actually reflect the price that the property could fetch on the market. They also tend to be more of a ‘box ticking’ exercise rather than the more subjective building survey by a Chartered Surveyor. This is not very different from the situation in the UK where a ‘drive-by’ valuation is carried out by the lender’s surveyor.

Building Survey – the most useful kind for house buyers, where the surveyor takes on the role of the buyer and inspects and reports on all those matters that might not have a major influence on the mortgage value, but undoubtedly could affect the buyer’s equity and quality of enjoyment of the house.

Structural Survey - only really carried out to investigate the cause of a problem found and can involve, for example, breaking into the structure or foundations to test their construction

Valuation Survey – often combined with a building survey. A market valuation of anything is described as much more of an art that a science. Ultimately a property’s value could be defined as whatever a person is prepared to pay for it. This kind of survey involves the gathering of as much evidence, knowledge and information of what’s happening in an area and its economy, the influences on people and places. This is extremely difficult in Spain in relation to finding reliable comparative evidence of what price properties have actually sold at – the full money paid. Sometimes even the escritura descriptions can be a ‘work of art’, with the sizes and accommodation bearing no relation to what is actually on the land. One can create appraisals, work out all the details of a property and apply equations and statistics, but at the end of the day the valuer has to look at the result on his computer screen and say to himself, “is that a realistic value?” That’s why it’s always stated as an Opinion of Value. Nobody can say exactly down to the last centimo what anyone unknown will pay for a property after negotiation.

In short, it is extremely worthwhile contacting a Chartered Surveyor registered with the F.R.I.C.S. (who are all required to carry indemnity insurance and have a professional body looking over them). The surveyor should be an independent professional with no links to banks, property owners, developers or estate agents in order that he can act in your interest alone. You can locate a Chartered Surveyor in your area by accessing to the R.I.C.S.’ website www.rics.org.