“Would you recommend a career as a dilapidation surveyor to your son or daughter? Raise your hands.” Not the most diplomatic question to ask the 400 surveyors of that ilk, assembled in steep tiers at the Mermaid Centre in London last week.
I hadn’t planned to be so blunt three months ago when I was asked to round off the annual RICS Dilapidations Forum with a 30-minute speech. A none-too-serious skate around the market was the plan.
But the awkward question was asked at the urging of a leading figure in the sector. And not a single hand was raised in support of the future of this subset of the surveying profession.
Dilapidation surveyors aren’t stupid. Most will admit, at least to themselves, that their expertise rests on foundations that may crumble within a generation. Meanwhile, a raft of rules, regulations, practice notes and protocols rest on the founding premise: using our arrangements is the only way to settle the costs of repairing a property when a tenant moves out at the end of a lease. A cottage industry, made up of surveyors and lawyers, thrives on a premise that is not hard to prove false. For example, Americans and continentals get along well enough without such a long-winded way of deciding costs.
Dilapidations is an art form that still looks inwards instead of outwards. It is an area of expertise whose practitioners are more comfortable discussing legal minutiae than debating the threat of their hard-won expertise becoming redundant.
Here are a few topics from last week’s forum: “How should a valuer establish a hypothetical purchasers’ intentions?” (Impossible, by definition, surely?) “Supersession: is it a matter of valuation, building surveying, or law?” (A simple matter of something taking over from something else, surely?) “How many angels can you get on the head of a pin banged into a wall? (I made that one up.)
Those who earn a living in dilapidations faced much the same issues face by those who made a living a generation ago as traditional QS practices. Anyone remember duodecimals? Taking off? Abstracting? Billing? The Standard Method of Measurement? All pretty much gone. Technology made the job of a QS simpler. But it also became apparent that much of the job didn’t really need doing at all. Those who saw it coming adapted, becoming “cost consultants” and/or project managers. Firms that didn’t quietly expired.
Snip out a few clauses in standard leases and the dilapidations industry collapses. Or not. After all, 95% of all property is more than 10 years old. Professionals will always be needed to judge, cost and manage repairs and settle disputes. Practitioners need to start thinking of better, cheaper and faster ways of doing these things. Now would be a good time to start.
Conflicts of interest? Nah!
Rumour has it that a few months ago one of the UK’s biggest fund managers came close to formally accusing one of the world’s biggest agents of failing to disclose a conflict of interest, after the agent sold one of the fund’s assets. The fund decided not to make a formal complaint.
The usual calculation was made: we don’t want to stop X bringing deals to us. Rip up the Investment Property Forum code of practice on conflicts published last year. At the time I said: “The idea that agents will put conscience before cash to avoid conflicts of interest simply because the IPF comes up with a stiffer code of practice than the 37 words the RICS devotes to the topic is absurd.”
Well, the RICS is now having a go. Members have until 16 October to respond to an online questionnaire sent out by the institution on 25 September. Here is one comment, made by a non-RICS member last year, in this space. “Clients should take matters into their own hands,” said Bob Kidby, former head of real estate at law firm Hogan Lovells. “Write to your agent and say, ‘If I give you this instruction, is there any chance of a possible conflict of interest arising?’” “Of course,” would be the honest answer, followed by, “Yeah… and what are you going to do about it, eh?”
