This week saw the removal of the material valuation uncertainty clause by Chartered Surveyors.
This was originally issued on 19th March 2020 by The Royal Institution of Chartered Surveyors (RICS) when the UK went into lockdown to stop the coronavirus spread.
What is the Material Valuation Uncertainty Clause?
In normal market conditions, valuers use, to a certain extent, past property market evidence to get to a valuation of a property for sale, purchase or mortgage security terms and rent setting.
Coronavirus changed all this, in short and in the words of financial services investment clauses "past performance should not be used as a guide to future performance". This was teh same for property valuations where the lockdown, furlough, lack of ability to move etc dramatically changed how a property could be valiued. In short, surveyors includeda material valuation uncertainty clasue to protect them from being sued by lender or purchase for gettng property valuations completely wrong during lock down.
Removal of Clause
During lockdown, the RICS had set up a forum with firms and on a weekly basis to discuss the material valuation clause and whether it should remain.
This week it was decided to remove the clause on residential property and land valuations as more 'normality' returns to markets.