Practice Note 16/1: State of Repair of Buildings

The Valuation Office Agency`s technical manual covering all aspects of compulsory purchase and compensation.

Where a report relates to the acquisition of buildings and includes a reference to the state of repair thereof, it is essential that an appropriate form of words is used to make clear the limited nature and extent of the valuer’s investigations into the structural state of the buildings and to place the responsibility for any full structural survey which may be required upon the acquiring authority.

At the date of inspection all the physical characteristics of the building including the services connected must be recorded and included in the relevant report.

Sub-paras (a) to (g) below indicate, in relation to various circumstances, the essential matters which are to be covered by the form of words used in the report:

a) where no structural defects are apparent, the report should say so but make it clear that no structural survey was made;

b) where structural defects or tell-tale signs are apparent but these are commensurate with the construction, age and surroundings of the property so that the effect, if any, can be reflected in the valuation without further investigation, the report should make brief references to the apparent defects and include an opinion that these are commensurate with the construction and age of the building. The report should also make it clear that they are reflected in the valuation and that no structural survey was made and that hidden defects maybe present which could only be identified by a more detailed inspection. If the likelihood of hidden defects (such as wall tie corrosion in certain properties and vulnerable locations) is considered to be high then a warning statement to that effect should be included making it clear that no account has been taken of such possible hidden defects;

c) if the acquisition relates to buildings which are to be retained by the acquiring authority and apparent structural defects or telltale signs indicate the need for further investigation and the valuer thinks the defects may be serious enough to have a material effect on the valuation or, where the authority is not committed to acquire, to cast doubt on the advisability of acquisition, the valuer should recommend the authority to obtain a structural survey. In these circumstances, if the authority decides to proceed after the survey, the valuer’s report should refer to it and state that the matters mentioned therein are reflected in the valuation;

d) if in the circumstances set out in sub-para (c) the acquiring authority is unwilling or unable to arrange for a structural survey before the valuer reports and the valuer requires assistance in the further investigation of the defects, a request should be made to the Building and Machinery Surveyor Service (BAMS) for assistance using the pro forma available on the intranet. The valuer’s report should refer briefly to the defects found and state that they are reflected in the valuation. The Report should also make it clear that a full structural survey has not been carried out. No reference should be made in the Report that advice has been obtained from BAMS. If the defects are serious and the acquisition is by agreement that permits the acquiring authority to choose whether to proceed or not, the valuer should include in the Report a recommendation that the authority should obtain a structural survey before completing the purchase;

e) where the acquisition relates to buildings that are not to be retained by the acquiring authority and there are apparent structural defects or telltale signs that may be serious enough to have a material effect on the valuation and the valuer requires assistance in the further investigation of the defects, the advice of BAMS should be sought. In the Report the valuer should refer to the defects found, state that they have been reflected in the valuation and make it clear that no structural survey was made. In these cases it would not be appropriate for the valuer to recommend that a structural survey should be obtained by the authority before completing the purchase;

f) in relation to sub-para (c) and (e) it is stressed that all defects that are obvious must be recorded and a particular note should be made of any potentially dangerous structure or defect in the property or within the curtilage. Defects can occur to roofs, gutters, chimney stacks, drains, manhole covers, boundary fences, walls, trees, etc as well as internal defects and can include additionally any item that could be a danger to prospective purchasers, occupiers or the public in general;

g) all defects noted on inspection must be included in any subsequent report. The detail must be sufficient to enable the acquiring authority to identify the defect so that any repairs can be carried out to remove the danger. Any urgent repairs needed should be highlighted and the possible consequences of delay and/or failure to repair made clear to the client.