The Ins and Outs of RICS Valuations
Property valuations provide buyers and sellers with an accurate estimate of the value of properties. If you are selling your home, there are two main options to choose from in terms of valuations. These include estate agent valuations and surveyor valuations. Qualified surveyors carry out RICS valuations using a framework established by the Royal Institution of Chartered Surveyors.
What is a RICS valuation?
A RICS valuation is an assessment of the value of a property, which is conducted by a chartered surveyor. Surveyors work under guidelines set out by the RICS, providing accurate estimates for sellers and prospective buyers who may want more information about the value of a house or flat before they buy.
Are RICS valuations lower than estate agents?
RICS valuations differ from estate agent valuations. Estate agents can value properties, but they don’t have the expertise of valuers registered with the RICS. Often, estate agent valuations are inflated to maximise the chances of securing clients and achieving the highest sale prices. If you are thinking about selling your home and you want an accurate valuation from an estate agent, it’s a good idea to ask at least three agents to visit your home. An RICS valuation will usually give you the most accurate figure.
What does a home valuation entail?
A home valuation is an inspection, which is designed to determine the value of a property. During an RICS property valuation, a surveyor will complete a tour of the house or flat, making observations and taking notes. A surveyor will consider a number of factors, including:
- The general condition of the property
- House prices in the area and recent sale prices
- The size of the property
- Property features
- Location and access to amenities
Expert surveyors use their knowledge and experience to provide a valuation based on the factors listed above and comparisons between the property and others in the area. A surveyor will provide you with a figure and explain how they came to it. An RICS valuation is based on research, observations and evidence.
If you have a property valuation booked, it’s a good idea to prepare your home. Clean and tidy the house, freshen up paintwork and finish off any half-baked DIY projects. Spruce up the garden, make sure access points are clear and let natural light flood your living spaces. Simple touches could make a difference to the valuation.
When would I need an RICS valuation?
Most commonly, RICS valuations are used for mortgage purposes. If you apply for a mortgage, and you’re all set to buy a house or an apartment, a surveyor will visit the property on behalf of the lender. The aim is to ensure that the valuation matches the price the buyer is willing to pay. It is also increasingly common for homeowners to invest in RICS valuations due to legal requirements linked to the Help to Buy and Shared Ownership schemes. If you have bought a house through these programmes, you will need an RICS valuation if you wish to sell or buy a larger share.
It is also possible for buyers and sellers to use an RICS valuation rather than an estate agent valuation. Estate agent valuations can provide a useful insight into property values, but they are generated with a view to making a sale and figures may be significantly higher than an RICS valuation. The RICS valuation can help to lower the risk of paying more than the property is worth if you are a buyer and give you a more accurate idea of your property’s worth if you are a seller.
What influences property value?
There are several factors that can impact the value of a property. These include:
- Characteristics and features
- Local area (proximity to good schools, transport links and amenities)
- Garden and outdoor space
- Potential to develop and add value
- Planning permission
- External structures, such as garden rooms, conservatories and summer houses
The state of the housing market can also cause prices to rise and fall. If the demand for properties outweighs the supply and a large number of people want to move, prices will go up. If demand is falling, it will take longer for properties to sell and prices will start to go down. It is wise to consider market movements when viewing properties and deciding when to buy or sell. Unless you are in a hurry, it may make sense to wait until demand increases if you are selling and prices fall if you are buying. You can find information about recent sales prices in your chosen location on the Land Registry website.
How long is a RICS valuation valid for?
Property valuations usually take up to an hour. It may be possible to provide a valuation on the spot, particularly if you are using an estate agent valuation. In some cases, you will need to wait a few hours or a day or so for your valuation estimate to come through. Once you have an RICS valuation, it will be valid for three months. If you choose to have a surveyor value your property, they will provide you with a copy of the report, which details the estimated value and offers additional information about how they calculated the price.
It is essential to understand that a valuation will not always reflect the price buyers are willing to pay. If your property is worth £250,000, for example, there is no guarantee that you would get an asking price offer if you put the house on the market at that figure. A valuation will give you an estimate of the property’s worth, but it is up to buyers to decide how much they are willing to pay and sellers to decide how much they will accept.
Property valuations provide an estimate of a property’s worth. Valuations are useful for buyers and sellers. Estate agent valuations will give you an idea of how much a house or flat is worth, but an RICS valuation provides an accurate figure based on a framework set out by the RICS. In many cases, an RISC valuation is required, but even if you are not legally obliged to have this kind of valuation, it’s beneficial to consider contacting a surveyor to get the most accurate valuation. You can find out more about RICS valuations carried out by CJ Bloor here.