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Friday, April 29, 2011

Mortgage valuation RICS registration

Landlords using a RICS surveyor for valuation purposes whether it be for their own purposes or through a mortgage company who require the valuation to protect their interest should be aware that from 30th April 2011 all surveyors acting in a valuation capacity should have registered under the RICS Valuation Registration Scheme.

Surveyors were criticised during the boom years for valuing up on many buy-to-let investments resulting in landlords owning off plan properties that were worth a lot less than they expected once the froth had been knocked off the over heating housing market.

Recently, surveyors have come under pressure for down valuing in an belated attempt to protect the exposure and interest of their mortgage company clients.

I'm not exactly sure why this new registration scheme will prevent these issues occuring again. 

Could it be a case of a professional body trying to shore up confidence in their members long after the horse has bolted!

Landlord Insurance - professional rates

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Anonymous said...

Hardly fair to say that Surveyors are trying to protect their clients, it is more that they are trying to protect themselves from being sued. They were asked to over egg the valuations during the boom years, by estate agents, mortgage brokers, banks, building societies and also the purchaser (so that they could meet the offer price).

An independent Surveyor should be just that, giving an independent valuation and it doesn't matter to them if the valuation is for £100,000 or £1m. They have learned their lessons and don't want to have to pick up the tab for others mistakes.

In addition in the boom years Surveyors were required to over value to remain on banks and building societies "approved valuers panels".
- If they are a RICS Surveyor, conducting a "red book valuation" why didn't the banks just let them be independent? Was it that giving the valuation the bank wanted more important to the bank than giving a truly independent valuation?

Now the boom years are over the banks are trying to sue Surveyors to recoup the money they lent to un-credit worthy individuals. This has then led on to Surveyors being naturally worried about giving over optimistic valuations as they were required to in the boom years by the banks.

It could also be that RICS wants to add a new way to charge Surveyors for a qualification that they already have, which is a trick other regulators have done in the past.

Margo Leadbetter said...

All good points, anonymous.