Also known as a “Red Book Valuation”, or “RICS Valuation Report”, they’re completed by registered RICS surveyors complying with RICS principals. They establish the market value of property, determining how much a lender or buyer will offer, and are essential for insurance, probate or investments or to redeem equity on, for example, a Help to Buy loan.
The guidelines, principals and standards for carrying out this sort of valuation are in an RICS publication called, “The Red Book.”
Only registered members of the Royal Institute of Chartered Surveyors (RICS) can conduct this type of valuation.
Not only does this provide consistency in carrying out the survey, but it also ensures that the valuation and expert advice has gone through a rigorous quality process.
As it’s carried out by an RICS registered surveyor, you have the assurance that the RICS ethical codes of practice back you up.
Being RICS certified is the industry standard, and achieving this prestigious qualification is difficult.
"80% of buyers don’t get a survey! It’s a gamble whenever somebody doesn’t."
(Home Owners Alliance)
Not getting a survey is perilous. It’s definitely a false economy. Whether you are valuing your home, selling, buying, mortgaging or engaged in a commercial project, consider the financial insecurity you’re putting yourself through.
Not knowing the true market value could cost you £1000s. If you’re worried, RICS Valuation Surveys give you peace of mind.
First, let’s cover the 4 main types of valuation and survey that are carried out by an RICS qualified surveyor.
This is a written market valuation of your property. This is best for anyone engaged in buying, selling, or re-mortgaging. It’s also used in “Help To Buy”, shared ownership transactions and for inheritance tax purposes.
It gives you independent advice on whether you’re paying a fair amount for the property.
However, it doesn’t give you any information on the structural integrity of the property.
In this type of survey, you get a detailed visual inspection of the property. It looks at the observable condition of the property and any areas of concern prior to purchase.
While it gives you the information on the visible structure of the property, it doesn’t give you a valuation.
Formerly known as a Full Structural Survey, this is the most comprehensive home survey. It’s ideal for older properties, those in poor condition or for planned works.
The report includes more in-depth analysis of the property's condition, comprehensive advice and an insurance rebuild valuation.
As with the Home Buyers Report, you don’t get a market valuation on the property.
Not only do you get an RICS valuation survey, but also a confirmation report on the structure of the property.
This is ideal if you need to know that you’re paying the market value for the property and the rebuild cost for insurance.
At Camsure Home Surveys, we offer all four types.
Even though we provide the RICS 'Red Book' Valuation as a standalone, we can also include the valuation as part of our RICS Level 3 Building Survey.
It’s a significant question.
There’s a lot more to valuing a property than looking on Rightmove or getting an estate agent’s opinion. Anybody can say they are a property valuer, but it’s only an RICS qualified and registered surveyor that can accurately give a valuation based upon the code of practice and ethical standards laid out by the RICS.
Whether you are buying or selling, it’s a massive misconception that you’ll get what you need from an agent’s market appraisal as opposed to a true valuation from an RICS surveyor.
Why? As each has a different focus.
I could go on, but as you can see, there is a world of difference between the two. If you want an accurate valuation on a property, then only an RICS Valuation Survey can provide that.
This type of valuation benefits the lender, not the buyer. Their aim is to value the property based on the forced sale value of the building or land and not on the market value.
Check My File defines the Forced Sale Value (FSV) as a: “Credit slang term for what price mortgage lenders expect a property to reach at auction if sold after repossession. This is usually around 70% of the market value (the price it would fetch if sold normally)...it is taken as the last resort for a lender to collect on the money owed.”
“There are several variables at play for determining the market value of a property, but being exposed to a wide selection of consumers over a long period with less urgency to sell, helps keeps values up. In contrast, FSV properties aren’t advertised alongside standard house sales and are sold quickly.”
As you can see, only an RICS Valuation Survey will provide you with an accurate market valuation for your property.
There are no laws that oblige builders and developers to provide a warranty. Even if they offer a guarantee, often the inevitable snags of any new build are not covered.
These snags can add up and affect the value of the property. To reduce any anxiety when purchasing, it’s always a good idea to get an RICS Valuation Survey.
With this information, you’ll certainly be able to have a conversation if there’s a gap discovered between the purchase price and the true market valuation.
Not all surveys are the same. It depends on the type of valuation. So what does an RICS Valuation surveyor look for?
As an example, a typical home and residential valuation will involve the following steps.
Once all the information is gathered, the RICS surveyor combines this with their local knowledge to give an accurate market valuation. It’s worth noting again that an RICS Valuation Survey is not a structural survey. It is for valuation only.
You should receive your report 2-7 days after the initial inspection. Because of the volatility of the housing market, the RICS Valuation is only valid for 3 months.
Unfortunately, you would have to take out another. However, according to the Home Owners Alliance, the average time for a conveyance is under 3 months if there is no chain.
So it’s unlikely you would have to get another one.
If the RICS surveyor has made an error, then you don’t have to worry. All RICS surveyors are backed with professional indemnity insurance and covered by the professional codes of conduct of the Institute.
For instance, the valuation of a property with no structural damage is £200000. The property has damage, so the estimate is £150000. Yet the selling price is £250000.
Because of the accuracy of an RICS valuation, in this example, it would give the buyer the information to re-negotiate the purchase price or pull out.
There are different options including:
All of Camsure’s chartered surveyors are RICS qualified and skilled in Valuation Surveys. You can find a surveyor near you easily by visiting: Areas We Cover.
As you can see, whether you are buying, selling, re-mortgaging, insuring or involved in probate, getting an RICS Valuation Survey is critical. This is the only valuation that will give you an accurate market valuation of your property or land.
If you have questions or would like some advice, please get in touch.
RICS - www.rics.org