All those involved in the sale, letting or valuation of property should be aware of a new code of measuring practice. Ian Campbell summarises its effects.
Accurate measurement of buildings is important. Sometimes it is seen as a chore. Understandable this may be, but diligence is now more important than ever. The necessity for accurate and consistent procedures when measuring property has long existed. Recent additions to consumer protection legislation, in particular the implementation of the Property Misdescriptions Act 1991, underline the importance of taking care when measuring buildings. If floor areas are wrong, your valuation may be too!
This week the Royal Institution of Chartered Surveyors and the Incorporated Society of Valuers and Auctioneers publish a new edition of the Code of Measuring Practice (Fourth Edition) prepared by the Working Party. The last comprehensive review was in 1987. Evolving market practice, the new Use Classes Order, which came into effect in 1987 and introduced the new B1 class, the Property Misdescriptions Act 1991 and the prospects of metrication are some of the reasons why there is a new edition.
Basis of measurement
In order to take fully into account all the changes, the new code amounts to a total revision of the 1987 edition. In the new code the working party has given greater clarity to the meaning of the original definitions. For example, the three general definitions, GEA, GIA and NIA (now called core definitions) are no longer interdependent.
To a greater extent, the technical definitions remain much the same, but in many cases adjustments have proven necessary to these too.
In order to make it easier to use by practitioners and others, the fourth edition introduces definitions in three sections:
- core definitions
- technical definitions
- special use definitions
For valuers and those involved in marketing buildings the core definition to use will often be NIA (net internal area). The old general definition of NIA in earlier editions read:
The usable area within a building measured to the face of the internal finish of perimeter or party walls ignoring skirting boards and taking each floor into account.
The new core definition now reads:
Net Internal Area is the usable area within a building measured to the internal face of the perimeter walls at each floor level.
The other core definitions are GEA (gross external area) and GIA (gross internal area). They are suitable for specialist applications, for example, industrial buildings.
The new edition takes account of the responses received from a comprehensive consultation exercise. For example, this edition sets out 10 parts of the floor area of a building which fall within the definition of NIA. It also describes nine others which do not. Where necessary, explanatory notes are provided to accompany the definitions. The new code includes a handy applications reference to enable its users to establish quickly the basis of measurement appropriate to a particular type of building. Additional diagrams are included to help those not familiar with the code to understand what must be included, and areas to be omitted.
What the code is not
Confusion sometimes arises about the function of the code. It is a code of measurement. It is not a code of valuation. For example, valuation techniques such as the zoning of shops for comparative purposes, or the adoption of different rates of value in areas of restricted use, do not form part of the code. Questions such as these, and the value to be attached to such areas, are matters of commercial or professional judgment.
In practice, the new edition is intended to help all those involved in the sale, letting, purchase and valuation of commercial and residential property. It describes widely accepted definitions of floor areas, and sets out guidelines for linear measurement. A uniform approach to measurement has obvious advantages. It reduces the likelihood of uncertainty and subsequent disagreement.
Status of the code
Another question which is often asked is the status of the code. While the code is not mandatory, its influence and weight has increased in recent years. This success reflects credit on Ron Scott, the previous chairman, and his colleagues who produced the 1987 edition. All the same, there are those in property who prefer to rely on other methods of measurement. This is their choice.
Statutory issues and the professional duty to clients
On April 4 1993, the Property Misdescriptions Act 1991 became law. This Act says (see section 1.1) that those involved in an estate agency business or property development must ensure that the information provided on the specified matters is not false and is not misleading. Measurement is one. Do not forget that accurate measurement is a matter of fact. It is not a matter of opinion. It is certainly not a matter for guesswork! As the Act makes clear, the provision of false or misleading information on measurement is a criminal offence. The Act imposes an obligation on those to whom it applies to ensure that dimensions and floor areas used in the marketing and sale of property are correct. To those who are, perhaps, accustomed to a more happy-go-lucky approach, a different attitude will now be required.
Use of the code should make it possible to avoid most errors. The view of the working party is that inaccuracies which are trivial, from the point of view of the user of the space, not the point of view of the supplier, may be in accordance with the code. Whether the courts will adopt the same approach remains to be seen. A simple test is available. Imagine you are the user or consumer. You may be a couple buying a house. You may be a company renting a building. Do you feel disappointed when you first see the property? Are the room sizes as you visualised? Do the floor areas match the picture in your mind, based on information you received? If the answer to one of these questions is no, you may be entitled to complain to the Trading Standards Officer. If this happens, he will investigate. He may also decide to prosecute.
Users of earlier editions of the code are aware of long-established and clearly understood professional duties to the client. These duties are not displaced by the additional statutory obligations to consumers and users of property. The working party, in drafting the fourth edition, has given full weight to both aspects. For example, the core definition, GIA, while suitable for certain specialist applications, may not be suitable for the marketing of property. If a member of the public buys or leases a small factory measured on GIA basis, he needs to be aware that the definition GIA includes within it floor areas which are excluded in NIA: for instance, the void over stairs and lifts. GIA is widely used in practice in the property industry to measure and market industrial and warehouse buildings and includes these “notional” areas. But the test under the Property Misdescriptions Act of what is, and is not, misleading is likely to be what the man on the Clapham omnibus thinks – which is all important. If the GIA is used as a basis of marketing property the attention of the public must be drawn to this sort of anomaly. Chartered surveyors and other professional advisers must be clear when advising their clients of the requirements of the law.
Measurement of B1 buildings
In March 1989 Ron Scott issued a statement addressing the problem of measuring high-technology and business buildings – now called B1 buildings. It is now six years since the 1987 Use Classes Order introduced this new hybrid class. Market practice has evolved. New legislation has arrived.
Nearly 1,000 copies of the draft code were sent out earlier this year and more than 500 responses were received on individual points including this one. This feedback was a great help to the working party and played its part in deciding the correct basis of measurement for B1 buildings. The decision is that NIA is the preferred method of measurement of B1 buildings.
Metrication
The new edition suggests that users of the code may wish to move towards a metric method of measurement, in place of imperial, well before January 1 1995. At this date it becomes mandatory to provide measurements in metric units. A daunting prospect follows: it is that rental values will also be stated in terms of so many pounds per square metre. For many of us this will be a culture shock! Until December 31 1999 it will still be permissible to give measurements and sizes in imperial units as well.
Unlike the Property Misdescriptions Act 1991, the introduction of metrication is not backed up by sanctions. The RICS and the ISVA are actively considering what guidance and advice should be given to members concerned to respond to metrication in the proper manner. Further guidance on this issue can be expected shortly.
Acknowledgement
My grateful thanks to all members of the working party for giving a lot of time to producing the new edition. I am particularly grateful to the three members who chaired the business, retail and residential groups: Ian Dodwell of Weatherall Green & Smith; Graham Chase of Erdman Lewis; and Roger Laid of the Valuation Office in Bromley. My appreciation also to the other members of the working party: Phillip
Beardwood, St Quintin; Peter Biles, BOC; Frank Crouchman; Keith Halliday, IRVO; David Hughes, IRVO; Jim Meikle, Davis Langdon & Everest; David Pow, King & Co; David Robinson; and Geoffrey Sharpe. And thanks, too, to our secretariat, Sarah Hunt and Simon Coates, for their support.
Copies of the Code of Measuring Practice,
A Guide for Surveyors and Valuers are available from the RICS London and Coventry bookshops and by mail order (071-222 7000 or 0203 694757) and from the ISVA (071-235 2282).
Ian G Campbell is a senior partner at Campbell Gordon and Reading chair of the RICS/ISVA Code of Measuring Practice.
