RICS is developing a new Professional Standard to align bank lending valuations with Basel III’s “prudently conservative” criteria, to ensure property valuations are appraised:
✔️ Independently with conservative criteria
✔️ No assumptions of future price increases
✔️ Adjustments for market fluctuations over a loan period
Basel III aims to strengthen bank capital, risk management, and transparency. This will help ensure global consistency in valuation practices.
These reforms could enhance financial stability by reducing the risk of real estate “bubbles”, with stakeholders gradually adjusting to more sustainable long-term valuation methods.
The RICS Standard will offer global guidance. Draft consultation available by late spring/early summer, with final publication later this year.
For more details, read the full article here RICS Expert Group on Bank Lending Valuations and the Basel III Accord
