When a buyer receives a closing cost estimate, the first inclination may be to try to cut costs wherever possible. And though it used to be the norm for every buyer to purchase a survey at settlement, many now wonder if the expense is worth it.
Whether your buyer should purchase a survey depends on a number of factors and the type of survey. Let’s explore the two most common types of surveys, a house location survey and a boundary survey, and discuss when each survey would be a smart purchase for your buyer.
The house location survey is a drawing that depicts the improvements to the property relative to the boundary line. Surveyors are sent to the property to determine where the property lines are, and note any and all improvements including sheds, fences, the house itself. This information is helpful in determining whether a neighbor’s improvement encroaches on your buyer’s property, and whether an improvement on your buyer’s property encroaches on a neighbor’s land. Boundary line issues are more prevalent than you may think, and a house location survey is helpful in resolving them.
In addition, the drawing depicts any easements, rights of way, and building restriction lines. This information is helpful to know who has a right to enter and exit the property (and where), and where your buyer is permitted to build further improvements.
The house location survey is the cheapest option. It usually runs about $300-500 for a typical subdivided lot on less than an acre of land. For greater acreage or funkier boundary lines, the survey could run much higher in cost (think $800-$1200).
Note, however, that a house location survey is not sufficient for your buyer to obtain permits. In this case, a boundary survey may be the best option. In addition to creating the rendering of a house location survey, a surveyor completing a boundary survey will find and mark the corners of the property with iron rebar, and stakes or flags that can be located above ground. For this reason, a boundary survey is more expensive and takes more time to complete.
When guiding your client, ask the following questions:
Is there anything on your client’s property or the neighboring property that would give you reason to believe a boundary line issue may arise? If so, a house location survey is suggested.
Is your client planning on building a fence, deck, addition, or pool in the near future? If so, determine whether the planned improvement requires a permit. If it does, suggest to your client to purchase a boundary line survey.
Is your client purchasing a condominium unit? Depending on the configuration, a survey may not be necessary.
Know that a client can order a survey at any time. They need not be ordered at settlement. If your client decides on purchasing a survey in the settlement process, we at Highland Title & Escrow will reach out to one of our reliable surveyors to obtain a quote for your client, and then we will order the survey if directed by your client. If you or your client is interested in speaking further about the contract property, a boundary line issue, or a question regarding a survey, have them call one of our settlement attorneys here at Highland Title & Escrow and we would be happy to assist.