BLOG: What is a ‘Red Book Valuation’?
We often receive enquiries from potential clients asking for a ‘Red Book valuation’.
‘Red Book’ Valuations are those that meet the criteria set out by the Royal Institution of Chartered Surveyors (RICS).
In reality, as a firm of Chartered Surveyors and RICS Registered Valuers, nearly all of the valuations we undertake are ‘Red Book valuations’ – to use the title Chartered Surveyor, we must adhere to the RICS code of conduct at all times, which includes following the guidelines as set out in the latest edition of the RICS Red Book.
But what exactly is the ‘Red Book’ and what does it contain?
The ‘Red Book’ is the name given to the RICS’s Valuation Professional Standards. Published every 2 or 3 years, the valuation standards are a set of mandatory rules and guidelines for RICS Registered Valuers to follow when they are undertaking valuations. The latest edition of the Global Red Book was published in 2017, with a UK supplement, for valuations that are subject to UK jurisdiction, being issued on 14 November 2018.
Whilst it doesn’t dictate what valuation methods should be used, the Red Book sets out the standards that should be followed. These include ethical standards, duty of care, the qualifications of the valuer and the minimum content of a valuation report.
The main reasons for the ‘Red Book’ is to ensure that clients instructing a RICS Registered Valuer can be sure that they will receive a properly researched valuation prepared by a qualified and independent Valuer working to a set of established and consistent standards.
Each year, firms of Chartered Valuation Surveyors and RICS Registered Valuers are required to submit an Annual Return to the RICS, to confirm how many ‘Red Book’ valuations have been undertaken.
‘Red Book’ valuations are also specified by institutional lenders, such as banks and mortgage providers. Similarly, where formal legal proceedings or a tax calculation is involved, such as in a property dispute, a divorce case, an inheritance tax calculation or as part of company accounting, a Red Book valuation is usually called for by the solicitor or accountant dealing with the case as they know that all the correct procedures will have been followed and the Valuation received will withstand any scrutiny it should face.
For more information on obtaining a ‘Red Book’ Valuation from the Lea Hough team, please contact us. From our office bases in Preston, Blackburn, Lancaster and Clitheroe, we cover the whole of the Lancashire area.
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