More than 250 people attended Monday’s Property Valuation Conference in Westminster, organised by the RICS valuation practice skills panel and Estates Gazette.
After sessions on investment valuation, over-renting and the valuation of incentives and inducements, the pro-DCF lobby urged the traditionalists to change their valuation technique.
“The world has changed drastically,” argued Nick French of the University of Reading. “Accountants and bankers are more than willing to carry out DCF valuations, but other professionals don’t have our property expertise.
“You can do these valuations in the same time it takes to do a normal valuation on paper. I don’t think it will be very long before the market-place wishes to adopt this technique,” he said.
Turning to fees, Colin Vaughan of DTZ Debenham Thorpe described the practice of selecting valuers on the basis of lowest fee bids as “daft” and said: “If we start providing clients with what they want, they will pay for it.”
In the afternoon, skills panel chairman Bruce Duncan confirmed that the amended White Book guidance on valuations for lending purposes (VGN 12) will be published by the end of March and will incorporate a proposal to replace open market value with estimated realisation price;a definition which he described as “forward-looking” rather than a forecast.
“VGN 12 also refers to appraisal,” noted Duncan. “This will mean the consideration of market trends. The valuer will have to get his hands dirty and ensure he knows how the market works.”
The eagerly awaited VGN 13, on the valuation of hotel, leisure and licensed property, will be published at the same time.
