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And the Survey Says……
July 15th, 2008 categories: Buyer Info, Home Inspections, Real Estate Investing, Real Estate News, Seller Info
Television game shows are famous for using the line “…and our survey shows…” Who knows how these surveys are conducted. Does anyone ever check the results? Is the buying and selling of real estate a game show? Of course not, but there is a big deal survey when it comes to purchasing a home. 
That is a different survey. The kind of survey done for home sales is done in a similar fashion today as it was a number of years ago.
That is using the transit and a multitude of tools to essentially measure a property to determine boundaries, dimensions, etc. I have always wanted to follow a surveyor around and look through their scopes, etc. and see what all they do. Seems fascinating to me in an geeky sort of way. Maybe one day I will get the opportunity.
Anyway…in a real estate transaction, the question of a survey often comes up in the closing process. In the Charlotte, NC area we are not required to have a survey completed to close out a transaction. Banks don’t seem to care, though they recommend a survey be obtained. (This has always sorta baffled me…more on this later)
So what is the deal with a having a survey in the closing process? Like just mentioned, a survey is typically not required by anyone to get a home sale completed. I can go out, find me a house, agree to a price with the seller, find an attorney to handle the transaction, hand the seller a check, and have the attorney record the sale at the courthouse. All this with no survey.
If you have never thought much about property lines, surveys, etc. here’s some scoop for ya. In everyday-USA–subdivision, property lines were originally established by a surveyor who was under the direction of the developer, city, county, etc. as to how the subdivision would be laid out. The surveyor went around and marked each individual piece of land and probably drove some very long steel rods into the ground to mark the corners of the property. The builder then came in and built a beautiful new home within these property lines. As a side note here: most subdivisions also have rules as to the setback lines on a property. Setback lines establish a sort of buffer between you and your neighbor. Setback lines are the closest point to the property line at which a builder can build on the plat of land. The setback distances are set as part of the rules and agreements with the builder and city/county zoning people.
So what does this have to do with buying a home? And what the heck does it have to do with me if I am buying a home already built? Actually quite a lot. The next part of the “survey-scoop” being provided here in this post: As a buyer I will be asked (hopefully) by my top notch real estate agent if I want to have a survey completed as part of the closing process. If I’ve never done this before, I will probably say “…umm, I guess so, does it cost me anything?” My top notch agent will say “oh yes, here in the Charlotte area, a typical survey will run around $400, but they will bill that at closing..”
Yikes! Another $400 added to my closing costs? I hadn’t budgeted for that, so why should a person have one done? In my opinion, a survey is like a very cheap, one-time insurance policy. When you request a survey, you will get as a finished product a map of your property. It will show very accurately your property lines, set-back lines, all “improvements” made to the property. Improvements are things like the home, fences, storage buildings, etc. This “map” will also show any easements, major natural features like streams, lakes, etc. Hopefully the survey will have no surprises like a fence drifting over onto the neighbors property.
The surprises of a survey can, alone, make this money well spent. Here’s what I mean. Say you get the survey back and you see that the neighbors fence of the place you are about to purchase drifts over across your property line by a few feet in the far back corner. This is good information because you now have the right to go tear down that section of fence and throw the pieces into his pool. (just kidding – I wanted to see if you were still reading). You do have the right to demand Mr and Mrs Neighbor be so kind (we are in the South here in Charlotte, so we are polite) as to remove that part of the “offending” fence. Wait just a minute though…
A beautiful thing about surveys is that your attorney who is handling the closing (or escrow as some call it) can also tell you specifically what your rights are regarding the survey. The best thing is to let the attorney (who probably actually place the order for the survey anyway) advise you as to your rights and recommend the best way to deal with this. Normally you will discover this before the final papers are signed and you can get the seller to deal with it. Asking the neighbor to remove the fence is probably the second easiest solution. The easiest is just to ignore the issue, get the attorney to send the neighbor a letter to notify them. You can move in with having nothing done and live with no issues for probably as long as you own the property. Probably (and an attorney can confirm for your situation) there will never be any questions about this until you go to sell. Your buyer might get pretty excited (and not in a polite Southern way) knowing that they are giving up property to the neighbor and then you will probably have to deal with it. People can be funny about this. Some view giving up a few feet in a corner of the property as a trivial thing. Others will feel they are giving a piece of their soul and are willing to fight to the death for it. If your clever, on-top-of-things real estate agent knows this, he or she should have that fully disclosed in your listing paperwork. That way the potential buyer knows this well before the survey flags it.
The flip side of this is when the home you are buying has a fence or building that extends over onto the neighbors property. Again, you have the option with the sellers as how to best address this. If it is minor (at least in your eyes) you might just accept it and let it go. Of course if your neighbor sells their property and the new buyer finds your fence on his property,that fence might end up in your pool.
The point, though in all this, is that it is really in your best interest to know of any property line issues before you sign the papers. Plus if there are no known issues with your structures nor your neighbors, you have a document proving that to your buyers (assuming you don’t add anything to the property). It also is a very informative document for your own use. You will know specifically where your property lines fall and how where the various improvements sit in reference to these property lines. Therefore pay for a survey and be glad you did.
I will close this with a little survey horror story. Just this year I helped some buyers close on a gorgeous home that was only five years old. Fortunately I recommended they pay for a survey. Heeding my advice, a survey was completed. Not only was the neighbors fence encroaching onto my buyers’ property, but the builder had built the home in the wrong place! It was several feet over the setback lines on two sides. A person can’t exactly tear down a house a move it. The seller was not aware of the issue, until our survey. In the end, the seller had to spend A LOT of money in legal fees to get this cleared up. There was a tremendous amount of legal time spent trying to find out whose fault it was and how to clear up the problem. This eventually had to be brought before the city zoning board for a variance request. The closing was delayed by 7 months! If my buyers had not had the survey completed, they would have had this headache on them when the time comes for them to sell. whew!!
If I ever had any doubts about the benefits of a survey, this little incident sealed forever the importance of having one.
Happy selling and buying….
August 9th, 2008 at 1:00 am
Wow, I can’t believe they don’t require a survey either! We have to have one done for every house - sometimes they will use an existing one if it is current and no changes to the property have been made. I definitely think it’s a good idea to have one whether required or not!
Love the game show analogy too
It’s been awhile since I’ve watched Family Feud but I always wondered who are they surveying for their answers?