Property inspections for valuation reporting in a post-lockdown world
FROM a “red book” and compliance perspective, property inspections (both internal and external) are a fundamental part of the valuation process, regardless of whether the subject is a retail premises, warehouse, office building, hospitality venue or a development site.
They all require the same diligence and attention to ensure all pertinent factors are noted and given the appropriate consideration in the summing up.
Prior to the Covid-19 pandemic and lockdown, valuers tended to not concern themselves with internal inspections from a social distancing standpoint, nor did they need to complete a pre-screening questionnaire of the subject premises (and its occupants) with the client.
But as we emerge from the lockdown, the new norm places a responsibility on valuers to take appropriate precautions and steps to not only protect the health and wellbeing of our clients but also, ourselves and our colleagues.
Internal inspections are a necessary part of the valuation process and where we conclude in our professional opinion that we must carry one out (during lockdown no method of inspection was possible due to travel restrictions) and it can be undertaken safely, it is incumbent on us to contact the client to determine if access is viable and acceptable.
At the present time, Lisney have implemented a series of systems and protocols for our staff to follow in the fulfilment of our duties.
During these unique times, not only has our governing body the Royal Institution of Chartered Surveyors been supporting the profession in issuing regular updates and opinions on government practice and guidelines.
But a number of the leading lending institutions have thrown their support behind us in permitting (where possible) the valuers to undertake ‘virtual’ inspections of premises for valuation purposes where occupiers and tenants aren’t happy to facilitate access to their premises.
The current scenarios where internal inspections are not appropriate (and are not limited to) include:
:: An occupier is isolating because one or more family members has symptoms or where an individual has been advised to shield.
:: The property is an active care facility, housing association or HMO.
:: The surveyor has safety concerns for themselves, their client, the subject’s occupants and the public.
We will only accept valuation instruction where we are satisfied from the information available and assumptions that can be made and agree that we can provide a valuation that would be acceptable to the institution needing to rely on our report.
Key factors informing that decision are whether we can source appropriate comparable evidence from which to base our opinion of value upon and secondly, whether we are able to form an opinion on value based on perhaps limited information available to us.
If we cannot fulfil these criteria, then it is our duty to inform the lending institution of those limitations and explain why the valuation may not be appropriate at the current time.
As it stands, Lisney has tailored its inspection processes to be compliant with the latest national and local government guidance for operating in public places, while following all public health guidance on social distancing.
John Coyle is associate director professional services at Lisney in Belfast (www.lisney.com)