What to do if selling a home without building regulations
Has your home been built, extended or renovated without building regulations approval? No completion certificate? Here is what to do when you want to sell.
What may require building regulations (building regs.) approval?
The answer to this is fairly broad, but typically includes:
- The erection or extension of a building
- Replacing fuse boxes and connected electrics
- Plumbing in a new bathroom
- Changing electrics near a bath or shower
- Replacing doors and windows
- Putting in cavity wall insulation
- Putting in extra radiators.
The work was done by the previous owner - am I responsible?
Yes. The building control department of your local council will consider the current owner to be liable for anything that does not meet building regulations, even if the owner did not carry out the work itself.
Whoever owns the property at the time works are carried out is required to have the work inspected in order to obtain a ‘certificate of completion’.
A certificate of completion is issued by a the assigned local authority buildings inspector, who must be notified before the alterations begin so they can monitor the entire process.
It may be that the work was carried out years before you bought the property and before certificates were issued. Or, the previous owner may have been unaware they needed one, or simply chosen to go ahead without notifying anyone.
Unfortunately, this is an issue you, as a subsequent owner, inherit.
The fact the work was not inspected does not mean it is substandard of course, only that the building control procedures were not followed.
Can I just have the works put right?
You could and, assuming you did so formally in conjunction with the local authority, would be issued a 'regularisation certificate'. This is the next best thing to a completion certificate.
However, this article is pitched at those looking to put their property on then market and such a course of action would likely be too long-winded.
So what are my options?
The easiest, cheapest and most common way of dealing with lack of building regulations is by purchasing an indemnity insurance policy.
An indemnity policy will cover the owner of the property against costs and losses as the result of the local authority carrying out an enforcement action.
An enforcement action would be the likely consequence of the local authority being notified of the lack of building regulations approval. The local authority would most likely carry out a subsequent inspection of the works and decide whether they meet the regulations.
The local authority may then require the current owner to rectify the work or even return the property to its’ previous state.
The indemnity policy would cover the cost of the remedial works and any diminution of value..
The cost of the policy will depend on the value of the house; the higher the value, the more the insurance will cost. If the house is worth £500,000, basic building regulation indemnity insurance could cost around £175.
Who pays for the indemnity policy?
Sometimes then buyer, sometimes the seller and sometimes 50:50.
However, we would recommend, given the low cost of indemnity, that you offer to pay for the policy. It would also be prudent to take out the policy via your conveyancing solicitor as soon as you put your property on the market.
This way, you are proactively minimising any impact that lack of building regulations can have on your sale.
Important points to remember
- Building regulation indemnity insurance only covers the owner against an enforcement action from the local authority; it does not cover against any costs incurred as the result of substandard works having been carried out on the house.
- Because the insurance does not guarantee the quality of the work done, your buyer may be relying even more heavily on the surveys carried out on your home.
- The insurance will no longer be valid if any contact is made with the local authority regarding the lack of a completion certificate.
And most importantly of all…
If any approach has previously been made about the lack of building regulations to the local authority, you will not be able to obtain a building regulation indemnity insurance policy. Under no circumstances should you contact the local authority and notify them.