Oakfield Building Chartered Surveyors

Help to Buy Valuations

When do I get a Help To Buy valuation?

If you’re looking to sell or remortgage a property you bought via the Help To Buy scheme, then you’ll need a Help To Buy valuation. Find out all you need to know about these valuations from the team at Oakfield Chartered Surveyors, including what the report entails and when the right time is to get one.

What is Help To Buy?

Help To Buy was a government programme first introduced in April 2013. Coming to an end in March 2023, it was designed to help people struggling to save up for a deposit to get onto the property ladder by offering an equity loan of up to 20% of the properties value if buyers could provide a minimum 5% deposit – the remaining 75% was borrowed from a mortgage lender on a repayment basis.

The Help-To-Buy equity loan scheme, which closed for new applications on 31 October 2022, was only available for new-build homes under a certain value. There is an alternative scheme available called Shared Ownership, which lets you purchase a share of your home with a mortgage loan.

Help to Buy Valuations

What is a Help To Buy valuation?

A Help-To-Buy valuation is a report that details the current value of a home bought under this scheme. Like any home valuation, you will require one if you want to redeem the loan, remortgage or sell the property.

The HCA (Housing Corporation of England) set up this service in 2014. They chose Target as a partner, which acts as the regulator. 

What does a Help To Buy valuation include?

A Help to Buy valuation is designed to help you understand your repayment fee and to provide an updated price of your property before you sell it. The valuation typically includes:

A Help to Buy valuation includes a description of the property, details about its location and an assessment of its condition. It also includes information about any fixtures that are included with the property and any land it is on.

A Help to Buy valuation will also include a breakdown of the accommodation. This includes:

· The number of bedrooms in the property
· The size of each room
· Whether or not any rooms are ensuites
· The age and condition of the property

The report also provides a summary of the gross external area of your property. This is the total area of all exterior surfaces, including walls, roofs and floors. The calculation is based on floor plans and building plans submitted by you or your agent.

Finally, a Help to Buy valuation will include the rebuild cost for the property. This is the cost of building a brand new house on your land and includes things like planning permission and legal fees.

Pay off equity loan
Help to Buy Equity
Help to Buy scheme

How does the Help to Buy equity loan work?

Note: applicants only have until the 31st of March 2023 to buy a home using this scheme. 

As mentioned above, those eligible for a Help to Buy equity loan require a 5% deposit, with the government lending them a further 20% of the property price. You’ll pay no interest on the loan for five years, but there’s an annual management fee of £12 (£1 per month). The property must be a new-build under a certain value (less than £300,000 in Wales and £600,000 in England).

When do you pay off your equity loan?

You have a few options here. You can choose to pay it off when you pay off your mortgage, when you sell the property, or when the equity loan term ends. No matter which one you choose, a Help To Buy valuation will be essential. If you’re paying back 20% of the current market value of your property, this will be necessary for calculating how much money you will receive when selling it.

Building Surveyors

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Our team is dedicated to providing the highest quality building surveys.
Contact us to discuss your requirements further.

How much is a Help To Buy valuation?

The cost of this service varies depending on the size of your property, its location and how much it’s worth but generally speaking, prices tend to range between £200 and £400 depending on the property. A Help To Buy valuation will provide you with a detailed breakdown of what your home is worth at present, and also give you an idea of how much it may be worth in the future if any improvements are made.

Help To Buy valuations are carried out by qualified surveyors who will complete their report within 48 hours of visiting your property.

When do I get a Help To Buy valuation?

There are several situations where you should think about getting a Help to Buy valuation:

If you’re planning to pay off a loan

If you’re planning to pay off the loan, you need to know the up-to-date value of your property. If your house’s value has increased, then the more you’ll need to pay back. It’s best to speak to a professional about this so that you can determine an appropriate payment schedule.

If you’re selling your home and have received an offer

When you receive an offer on your property, it’s time to request a Help To Buy valuation. The valuation will determine how much of the purchase price you need to pay back. The repayment amount is based on the highest figure, either the RICS valuation (the most likely scenario) or the agreed purchase price. If the property is undersold, this guarantees that the repayment figure is based on market value.

It’s worth noting that Help to Buy valuations are valid for three months, so you’re advised to only get a valuation if you have received an offer on your property.

How long does a Help to Buy valuation take?

A Help to Buy valuation will be carried out once the mortgage lender has received your completed application and other relevant information, including the purchase price of your property. The valuation is valid for three months from the date of issue. If you haven’t redeemed or sold your property within this time, you may be able to apply for a further desktop valuation.

Who are Target HCA?

It’s important that you speak to a surveyor who is regulated by Target HCA and that they can help you complete the purchase of your new home by providing valuations, making payments or altering them, and answering questions that you have about the scheme. Target HCA regulates surveyors and their valuations to ensure that no false claims are made.

How surveyors ensure Target compliance

There are several tasks your surveyor must do to ensure Target compliance. The surveyor will make sure that the property meets all Target requirements, which includes making sure your Help To Buy valuation is only valid for 3 months. The surveyor will also assess the interior of the property, including any furnishings or appliances that are included in the sale. They’ll check that everything is in good working order and that there are no problems with dampness or mould.

The surveyor must also produce their report on company-headed paper and be RICS registered, with their RICS number visible on the report. A copy of this report must be supplied to Target with the inspection date shown.

What RICS registered means

A RICS registered surveyor means you’ve had an independent valuation with a surveyor who complies with RICS guidelines. This ensures that you have a true market valuation as certain guidelines and rules have to be followed to come up with a valuation price.

You should also make sure that your surveyor can provide you with all the information about your property’s condition, as well as any issues that may need to be addressed before it can be sold on the open market. All of this will help ensure a smooth process when it comes time for your sale.

How do I repay a Help to Buy equity loan?

1. Think about your timings

As discussed previously, you need to make sure your timings work out so your valuation remains valid. This can help you to avoid excess fees, like a desktop valuation, on top of your existing valuation report.

2. Find a surveyor

The next step is to find an RICS-qualified surveyor to produce a Target-compliant valuation report. The equity on the property that you owe can then be calculated.

3. Pay any administration fees

You then have to complete a Loan Redemption Form and pay any administration fees that may have accumulated.

4. Receive a redemption letter

This letter will contain your calculated repayment figure from your surveyor.

5. Arrange a completion date

This puts you in contact with the Homes and Communities Agency (HCA) to complete your valuation and repayment.

If you live in London, Buckinghamshire, Oxfordshire, Berkshire or Hertfordshire and require a help to buy valuation, Oakfield Chartered surveyors would be pleased to provide you with a quotation.

Please call us on 01494 926236 or email us at info@oakfieldsurveyors.co.uk

RICS Registered Surveyor
Target HCA
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Picture of James Peck

James Peck

James has worked the residential property sector since 2005 with roles in Asset Management, Probate, Insurance, Party Wall Matters, Valuation and Building Surveying in both local and national areas having spent several years working within the London area and the Home Counties. James specialises in building surveying with a particular interest in non-traditional construction properties and historic buildings. James has an in-depth knowledge of residential buildings and provides clear and concise advice to clients.
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