Advice on buying a house with indemnity insurance

Kiki888

Hi

We have had an offer accepted on a house but the survey highlighted the attic conversion has no building reg. The current owners have an indemnity insurance policy to cover this. We were concerned about this and asked for retrospective building reg, which they flat out said no too.

I've been looking up online about indemnity insurance/lack of building reg but just wondering if anyone has any advice on if we should be worried, is this a quite normal thing on older houses, - any advice or knowledge would be appreciated

Thank you!

anselld

Indemnity insurance covers against enforcement action by the local authority, it does nothing to ensure that the structure is built properly and safe to use.
What did the surveyor say about the actual quality of construction of the conversion? That is what you need to understand and indemnity is no help in that regard.

I think there was a thread here a few months ago; I think the buyer insisted on building regs regularisation and the vendor eventually agreed.

Are they actually selling it as a liveable room?

Kiki888

It came back from the survey as fine- no issues with the structure.
It is the new master bedroom, with a toilet and sink.
I love the house, I'm just worried- what if we want to work on it in the future, what if they make us change it back, will it affect how easy it is to sell in the future,

anselld

Kiki888 wrote: »

It came back from the survey as fine- no issues with the structure.
It is the new master bedroom, with a toilet and sink.
I love the house, I'm just worried- what if we want to work on it in the future, what if they make us change it back, will it affect how easy it is to sell in the future,

They cannot make you put it back if it has been complete for more than 12 months.

As far as selling goes you will be on the other end of what you are facing now. It is not a major problem so long as the buyer is happy and the mortgage company have not objected.

Yorkie1

As others have said, after a certain period of time the council cannot enforce - so the indemnity policy is effectively not worth the paper it's written on, albeit still required by some lenders.

If they've only done the work recently then whey did they not do a proper job and get it signed off to B Regs standard? What corners have been cut? What safety corners have they cut? Are there fire risks? Have they strengthened the joists properly? Is it properly insulated?

You have no way of knowing the answers to these questions and neither will your surveyor. You therefore have no way of knowing whether the conversion is structurally or personally safe.

If the room has been counted in the 'bedroom' figures for the sale purposes then it should not have been.

Entirely your choice whether to accept the policy and the safety risks, or walk away if the seller refuses to do what is necessary to prove that what they've done is compliant and safe.

camptownraces

Despite what others have said, even after a longer period than 12 months a Local Authority's Building Control can impose an injunction requiring a building to conform to Building Regs or to be reinstated to previous condition.

No indemnity insurance can protect you from this.

How confident are you that this alteration meets Regulations? Why would anyone have sidestepped the issue if it did meet Regs?

I'd pull out of the transaction. You don't know the building is safe.

SmlSave

A lot of houses are going to go unsold if buyers take your advice camptownraces!





We have building reg indemnity on our house for the extension. The survey came back showing the building is sound and the extension has been there for years.


However, if it had been done in the last year or two I would have insisted that it be inspected by building regs.


Something to remember about a building regulation indemnity policy is - if you invite a building reg officer round you invalidate the policy.


P.S. I also work as a legal sec dealing with sale/purchase files every day, indemnity policies are common place

DRP

Our house was advertised as 3 bed and we found out during the process there was no BR for the third loft bedroom.

the vendors initially claimed to have the paperwork and then when they couldn't produce it, insisted it wasn't required.

We weren't happy to accept that because:

A) unless it is properly sorted (box ticking basically) then you'll have exactly the same issues when selling)

.and

it was advertised as a 3 bed and that's what we based our offer on.

In the end they got the loft regularised by the council inspectors - I'm told it cost a couple of grand between the work that was required and to get the inspection done ...