VALUATIONS
South African
Property Valuation
Increasing confidence in local valuations
BY TC CHETTY
Valuation is one of the key areas of practice for Royal Institution of Chartered Surveyors ( RICS ) qualified professionals .
In order to ensure globally consistent standards in valuation , the institution publishes RICS Valuation Standards - also known as the “ Red Book ”, which are mandatory for RICS professionals and RICS regulated firms and apply the requirements of international valuation standards .
In response to the last global financial crisis , RICS developed a regulatory monitoring initiative , known as Valuer Registration ( VR ), to ensure the consistent application of Red Book valuation standards worldwide .
Implemented as a mandatory scheme for all RICS members undertaking valuations in , inter alia , the UK , Netherlands , France , United Arab Emirates , Caiman Islands and Hong Kong , RICS Valuer Registration was launched in June 2016 and on a voluntary basis for any RICS valuer practicing in South Africa .
Following consideration by the RICS governance structures and the RICS Regulatory Board , RICS Valuer Registration will become mandatory for all member valuers working in the field in South Africa from 1 February 2017 .
The Valuer Registration scheme is intended to ensure confidence in the delivery of valuation advice and reinforce the highest professional standards in property valuation - a key component underpinning most economic activity . RICS main objective with this initiative is to reinforce the quality and accuracy of valuations while raising consumer confidence in the profession and , through effective regulation , minimising the risk associated with property valuations .
Valuer Registration provides key stakeholders in the property market with a clear designation that easily identifies the best regulated and qualified
valuation professionals , as RICS members welcome complete transparency and open benchmarking against industry best practice . It follows that making this mandatory in South Africa from 1 February next year will reinforce transparency and enhance market confidence .
In a globally competitive business environment , internationally benchmarked property valuation standards are essential to facilitate greater transparency , and through effective monitoring the Valuer Registration scheme will demonstrate compliance with existing international standards .”
While RICS members are regulated , registered valuers are subject to a specific monitoring that begins as soon as members sign up to Valuer Registration . An automatic risk score is established for the individual member and should any risks come to light , RICS will conduct further enquiry , including checking information against Red Book requirements , processes and audit trails that the Registered Valuer has in place .
Claire Everatt , head of Valuations at Eris Property Group says : “ The South African valuation industry has made good progress in the implementation of global valuation standards in recent years but , as valuers , we are more accountable than ever . The additional transparency that VR seeks to offer is vital in ensuring that we continue on this trajectory towards international best practice .”
In line with valuer registration being made mandatory for South African valuation professionals , RICS South Africa plans to provide additional information webinars and half-day technical workshops for RICS registered valuation professionals during October and November of this year ( 2016 ).
RESOURCES
RICS
36 NOVEMBER 2016 SA Real Estate Investor www . reimag . co . za