Glenny welcomes the RICS’ acceptance of the 13 recommendations from the independent review into real estate investment valuations overseen by Peter Pereira Gray and commissioned by the Standards and Regulation Board of RICS in 2020. The review, whilst focusing on investment valuations including for financial reporting, makes important recommendations regarding conflicts of interest, independence, regulation, and compliance (including the appointment within each firm of a Valuation Compliance Officer) that apply to all areas of valuation.
Whilst acknowledging the recommendation with regard to valuation methodology and in particular the use of Discounted Cashflow models for income producing real estate, we are pleased that the review recognises that “prescriptive standards may not be suitable to cover the vast range of valuation circumstances.” However, we support the call for greater transparency with regard to valuation methodology and data points used when reporting, something that our RICS Registered Valuers are conversant with, to offer clients a thorough explanation of the valuation approach.
In accepting the recommendations, RICS has said that these will be implemented “at different speeds”. We await further guidance and direction from the RICS and continue to support robust independent regulatory quality assurance for the valuation profession to ensure confidence in property investment valuations.