APC Master questions deck Flashcards
1
Q
What must members and firms do according to Rule 1 RICS rules?
A
Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS.
2
Q
What is required under Rule 2 RICS rules?
A
Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise.
3
Q
What is the expectation under Rule 3 RICS rules?
A
Members and firms must provide good quality and diligent service.
4
Q
What does Rule 4 RICS rules emphasize?
A
Members and firms must treat others with respect and encourage diversity and inclusion.
5
Q
What is the focus of Rule 5 RICS rules?
A
Members and firms must act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in the profession.
6
Q
What is the definition of yield?
A
Annual return on investment expressed as a percentage of capital value.
7
Q
What is the Comparable Method?
A
Most widespread method, assesses MR and MV. Requires a good body of recent comparables.
8
Q
What are the challenges of the Comparable Method?
A
Limited transactions, lack of up to date evidence, special purchaser.
9
Q
What is the Investment Method used for?
A
Used where there is an income stream to value e.g. tenanted property. Assess the rental value of yield.
10
Q
What type of properties does the Profits Method apply to?
A
Used for income producing properties, typically specialist properties such as hotels, golf courses, care homes.
11
Q
What is the Depreciated Replacement Cost / Contractors Method?
A
Used for owner occupied or specialist property that is rarely sold on the open market.
12
Q
What does the Residual Method assess?
A
Used for property or land with development potential, calculating the market value of the land.
13
Q
What is a Market Appraisal?
A
Estimated of what a property is worth dependent on the market.
14
Q
What does the Residual Land valuation output?
A
Output of market value of the land.
15
Q
What is the purpose of a Development Appraisal?
A
Output of profitability or viability of a site.
16
Q
What is the Monte Carlo Scenario?
A
Technique for quantitative risk analysis using computer-generated simulation to model outcomes.
17
Q
What does an equivalent yield represent?
A
Represents the return a property will produce based upon timing of the income received.
18
Q
What key metrics are discussed in financial performance briefings?
A
- Valuation
- Profitability
- Leverage
- Liquidity
- Efficiency KPI’s
19
Q
What is a profit and loss statement?
A
A financial statement that summarises the revenues, costs and expenses incurred during a specified period.
20
Q
Why is it important for surveyors to understand financial statements?
A
Provides a snapshot of a corporation’s financial health and performance and cash flow.
21
Q
What is a hazard?
A
Any risk of harm to your physical health, mental health, or safety.
22
Q
What is AML?
A
Refers to laws, regulations and procedures aimed at uncovering efforts to disguise illicit funds as legitimate income.
23
Q
What are the offences under the bribery act?
A
- Offering a bribe
- Accepting a bribe
- Not preventing an act of bribery
24
Q
What does SDLT stand for?
A
Stamp duty land tax.
25
What is the difference between arbitration and adjudication?
Arbitration is binding and formal, while adjudication involves quick resolution within 28 days.
26
What does PPE stand for?
Personal protective equipment.
27
What is market value?
The estimated amount for which an asset or liability should exchange on the date of valuation.
28
What is the difference between fair value and market value?
Fair value is an estimate of the market value based on current market conditions.
29
What is the purpose of a loan security valuation?
To assess the value of a property used as collateral for a loan.
30
What is profit erosion?
The gradual redirection of funds from profitable segments or projects within a business to new projects.
31
What is the minimum affordable housing requirement?
Varies by local government regulations and policies.
32
What is Japanese knotweed?
A weed that spreads rapidly and deep underground, exploiting the need for water and light.
33
How does Japanese knotweed impact property valuation?
Can affect the foundations of a property.
34
What is the RICS guidance applied to for inspection?
Guidance for surveying and inspecting properties.
35
What is included in the company terms and conditions?
Specific conditions under which services are provided to clients.
36
What are the key principles applied in the estate agency act?
* Honesty
* Transparency
* Fair trading
37
What does the blue book provide guidance on?
Professional standards and valuation practices.
38
What is the purpose of the complaints resolution procedure?
To address and resolve client complaints regarding services.
39
What are MEES?
Minimum Energy Efficiency Standards.
40
What are some exceptions for MEES?
Certain types of properties may be exempt under specific conditions.
41
What is included within professional fees?
Fees charged for professional services rendered.
42
What does the term 'special assumption' refer to?
An assumption that is not typical but is required for the valuation process.
43
What is the importance of the lone working policy?
To ensure the safety and well-being of individuals working alone.
44
What is the internal dominant face?
The face of the building that is most likely to be seen or used.
45
What are the limitations of using profit on cost?
May not accurately reflect the market value of the property.
46
What is the purpose of sensitivity analysis?
To assess how changes in input variables impact the output of a valuation.
47
What does a purchaser being financially qualified mean?
It means the purchaser has been assessed and confirmed to have the financial capacity to complete a purchase.
48
What is the Data Protection Act?
It pertains to information used to identify an individual or their personal details.
49
When was the Data Protection Act implemented?
2018.
50
What is the difference between GDPR and the Data Protection Act?
GDPR broadens the scope of DPA 2018 to include online identification markets, location data, genetic information, and more.
51
What are some individual rights listed on GDPR?
* Right to access
* Right to rectification
* Right to erasure
* Right to restrict processing
* Right to data portability
* Right to object
52
What is Resiforce?
A Customer Relationship Management platform.
53
How long can data be held for?
Only for as long as you need it.
54
What is encryption?
A method of converting information into a code to prevent unauthorized access.
55
What is the main law governing data management?
The Data Protection Act (2018) and GDPR.
56
How do you ensure the security of information in a café with public wifi?
Use a VPN and avoid accessing sensitive information.
57
What does AML stand for?
Anti-Money Laundering.
58
What are the 6 principles of the 2010 Bribery Act?
* Proportionality
* Transparency
* Integrity
* Accountability
* Fairness
* Effectiveness
59
What is a profit and loss statement?
A financial report that summarizes revenues, costs, and expenses incurred during a specific period.
60
What is a balance sheet?
A financial statement that reports a company's assets, liabilities, and shareholders' equity at a specific point in time.
61
What is EBITA?
Earnings Before Interest, Taxes, and Amortization.
62
What is a SWOT analysis?
A strategic planning technique used to identify Strengths, Weaknesses, Opportunities, and Threats.
63
What is an EWS1 form?
A form that lenders/valuers request for some multi-storey, multi-occupied residential developments to assess external wall safety.
64
How long are EWS1 forms valid for?
5 years.
65
Who conducts an EWS1 form?
A fire safety engineer.
66
What are the two main types of EWS1 ratings?
* A - External wall materials are unlikely to support combustion
* B - Combustible materials are present
67
What happens if a building has a B2 rating?
Remedial works must be carried out by the building owner to ensure safety before a mortgage can proceed.
68
Is an EWS1 form a government requirement?
No.
69
What is the structure of the RICS?
At the top is the Governing Council, followed by key boards and committees, professional groups, and membership levels.
70
Who introduced EWS1 forms?
RICS, UK Finance, and the Building Societies Association.
71
What is the purpose of the Freedom of Information Act?
To provide the public with access to information held by public authorities.
72
What is the main role of RICS?
* Maintain high standards of education & training
* Protect consumers through regulation
* Provide information and independent advice on land and property
73
What is an inclusive mindset?
An attitude that embraces diversity and promotes equity and respect for all individuals.
74
What are some examples of illegal discrimination?
* Age discrimination
* Gender discrimination
* Racial discrimination
* Disability discrimination
75
What type of buildings generally need an EWS1 form?
Multi-storey, multi-occupied residential buildings with cladding.
76
What is the DRC method?
The Depreciated Replacement Cost method, used for valuing properties.
77
Do you need an EWS1 form for a new block of flats?
No, a new building should be compliant with current building regulations and guidance at the time of construction.
## Footnote
The building owner should be able to supply all relevant certification regarding building regulations compliance.
78
Which RICS document outlines when an EWS1 form is required?
RICS Guidance: Valuation of Multi Use Residential 2021
## Footnote
Understand new guidance is coming out before the new year.
79
When are EWS1 forms required?
For buildings 6+ storeys:
* When there is cladding
* When balconies are stacked directly above each other and made of combustible materials
For buildings 5-6 storeys:
* When 25%+ of the whole elevation of the building had cladding
* When there are ACM, MCM or HPL panels on the building
* When balconies are stacked directly above each other and made of combustible materials
For buildings of 1-4 storeys:
* When there are ACM, MCM or HPL panels on the building
80
What are ACM, MCM, or HPL?
ACM – Aluminium composite material
MCM - Metal composite material
HPL - High pressure laminate
81
What do ACM, MCM, or HPL look like?
ACM/MCM – grey-ish metal sheets/tiles on the outside of the building
HPL – similar but not necessarily grey – often brown in color
82
What types of cladding are relevant for EWS1 forms?
* Timber
* Metal sheet panels
* Brick slips
* Metal composite material
* Aluminium composite material
* Plastic tiling system
83
What do you not need EWS1 forms for?
* Concrete panels
* Brickwork with concrete panels
84
Can banks still lend if the property requires but doesn’t have an EWS1 form?
Yes, under specific circumstances.
## Footnote
Nine different banks do now lend, provided one of the following has been met:
* A FRAEW (fire risk assessment external wall) has been carried out and identified remediation works.
* If the cost of work is known.
* Eligibility of building owner/landlord to pass on costs to leaseholder.
* Whether dates for commencement and completion of remediation works have been scheduled.
85
How do you value B2 properties?
If all the info the lender needs is available and the lender is happy to lend, value according to the red book. If not all info is available, communicate with the lender and state that works are required.
86
What is the definition of the red book?
A set of professional standards for valuers.
87
What is professional indemnity insurance?
Insurance that protects professionals against claims of negligence or inadequate work.
88
What is a desktop valuation?
A valuation conducted without inspecting the property.
89
When doing a residual, what is the current base rate?
Current base rate varies; check latest financial data.
90
Why is it important to measure a property?
To verify measurements, affect opinion of value, and assist in marketing.
91
What is the difference between IPMS and Code of Measuring Practice 6th Edition?
IPMS provides separate measurement tools for different classes of buildings (residential, office).
92
What legislation do you have regard to for H&S purposes when carrying out an inspection?
Health and Safety at Work Act 1974.
93
What is HTB?
HTB is a government scheme that helps first-time buyers become homeowners.
94
What is a Caveat emptor?
Let the buyer beware; the seller is not obliged to disclose all defects.
95
What would you do if someone failed an AML check?
Ask for additional information; if failed again, refer to legal and compliance team.
96
What are forms of purchase vehicles?
* Special purchase vehicle (SPV)
* REIT
* Joint venture
97
What is capital gains tax?
Tax on profit made from selling a property, typically between 18-28% depending on tax bracket.
98
What are the limitations of smart search software?
Not all data provided, issues with accuracy, data may be out of date.
99
What would you do if you suspected money laundering?
Follow RICS professional statement guidelines for real estate agency and brokerage.
100
What are the three principal types of depreciation allowance?
* Physical deterioration
* Functional obsolescence
* Economic obsolescence
101
What are some recent changes made to the UK National Supplement?
* Valuer rotation: 10 years firm, 5 years individual with a 3-year break.
102
What is included in the red book?
* Intro
* Glossary
* RICS Professional Standards
* RICS Valuation Technical and Performance Standards
* RICS Valuation Applications
* IVSC International Valuation Standards 2020
103
What is double dipping (dual agency)?
Single agent represents both the buyer and seller.
104
What is a phoenix firm?
An insolvent company that ceases operations, with assets purchased by existing management to form a new company.
105
What is whistleblowing?
The act of reporting wrongdoing, illegal activities, or unethical behavior.
106
What are the six RICS values published as a result of the Levitt Review?
* Integrity
* Respect
* Collaboration
* Excellence
* Accountability
* Innovation
107
What is the definition of a KPI?
A metric used to evaluate an organization's performance in relation to strategic objectives.
108
What is a memorandum of understanding?
A formal document outlining an agreement between two or more parties.
109
What does the NPPF say about sustainable development?
Framework for social, economic, and environmental objectives.
110
What was the Kyoto Protocol?
A treaty aimed at combating climate change by reducing greenhouse gas emissions.
111
What is gentrification?
Transformation of urban neighborhoods through the influx of wealthier residents, increasing values.
112
What is BIM?
Building Information Modelling, a digital representation of a building.
113
What is data redundancy?
Storing the same data in two places on the same database.
114
What is the RICS Inclusive employer quality mark?
Promotes diversity and inclusion in the sector.
115
What is a RACI matrix?
Responsibility Assignment Matrix, a project management tool to clarify roles and responsibilities.
116
What is neurodiversity?
Concept that recognised and celebrated the natural variations in human brain function.
117
What is a memorandum of understanding?
Formal doc, outlines an agreement between two or more parties.
118
What does the NPPF say about sustainable development?
Framework, social, economic and environmental objectives.
119
What was the Kyoto Protocol?
Treaty, aimed at combating climate change by reducing greenhouse gas emissions.
120
Can you tell me about COP-26?
2021 UN Climate Change conference. Address climate change, phase out of coal, finalising Paris Agreement.
121
What is the UK's current target for sustainability?
Net zero carbon by 2050.
122
What are carbon budgets?
Designed to manage and limit greenhouse gas emissions to mitigate climate change.
123
Can you give me an example of an environmental assessment method for buildings?
BREEAM, Certification.
124
What is corporate social responsibility?
Business model which companies integrate social and environmental concerns into their operations. Not just profit.
125
What is the climate change levy?
Tax imposed on energy supplied to non-domestic users in the UK.
126
What is a green lease?
Specialised lease agreement. Enhance performance of properties.
127
What is SUDS?
Sustainable drainage system. Manage surface water runoff.
128
What is an environmental impact assessment?
Systematic approach to evaluate the potential environmental effects of proposed projects or developments.
129
What are modern methods of construction?
Modular, panlised, 3D print.
130
What is a key proposal of the energy white paper?
Proposals to transform UK energy system, net zero by 2050 (clean energy, decarbonisation, investment in infrastructure).
131
Explain key objectives of the Environment Act 2021.
Legislative framework to improve environmental governance (long term targets, environmental goals, principles).
132
What are MRICS fees?
MRICS £539 (Under 2 £345).
133
What is the definition of a KPI?
Metric used to evaluate an organisations performance in relation to strategic objectives.
134
What is principled negotiation?
Interest-based approach to conflict resolution. Collaboration and mutual benefits.
135
What is a liability?
Financial obligation that a person/entity owes to another party.
136
What are the three pillars of dispute resolution?
Negotiation, Mediation, Adjudication.
137
What is a RACI matrix?
Responsibility Assignment Matrix (project management tool to clarify roles and responsibilities).
138
What is gentrification?
Transformation of urban neighbourhoods through the influx of wealthier residents, increases values.
139
What is a FRA?
Fire Risk Assessment (evaluation of fire risk in a property).
140
What is whistleblowing?
Act of reporting wrongdoing, illegal activities or unethical behaviour.
141
What are the six RICS values published as a result of the Levitt Review?
* Integrity
* Respect
* Collaboration
* Excellence
* Accountability
* Innovation
142
What is a phoenix firm?
Insolvent company ceases operations, assets are purchased by existing management, new company formed.
143
What is double dipping (dual agency)?
Single agent represents both the buyer and seller (incremental advice).
144
What is the assigned risk pool?
Providing cover to high-risk individuals who are unable to obtain insurance through standard markets.
145
What is an electronic document management system?
EDM - Electronic Document Management System - software to store documents digitally.
146
What is data redundancy?
Storing same data in two places on the same database.
147
What is the difference between a deed and a registered title?
Deed - legal doc that transfers ownership. Registered title - official record of ownership.
148
What is BIM?
Building Information modelling (digital representation of a building).
149
What is COSHH?
Control of substances hazardous to health.
150
Is it a criminal offence to breach the H & S at work act 1974?
Yes.
151
What happened in the case of Suzy Lamplugh?
1986, Fulham, murder.
152
What is occupational health?
Specialised field in public health (mental, physical, social wellbeing).
153
What is business continuity?
Continue operating during and after a disruptive incident.
154
What is PEST analysis?
Strategic management tool to evaluate political, economic, social and technological factors.
155
What are typical things you would find in a business plan?
* Executive summary
* Company description
* Market analysis
* Organisation
* Strategy
* Goals
* Financial projections
* Appendices
156
What is a locum?
Professional who temporarily fills the role of another.
157
What is RICS guidance relating to handling clients money?
Prof Standard client money handling, 2019 (2020).
158
What might client money include?
* Rent
* Service charge
* Interest
* General costs
159
What are examples of auxiliary aids?
Help individuals with disabilities.
160
What is the new second staircase statutory requirement?
From 30 September 2026, all new residential buildings over 18 metres high must have two staircases.
161
What document contains the second staircase requirements?
Fire safety: Approved Document B.
162
When was Fire safety: Approved Document B published?
Mar-24.
163
When do the changes regarding the second staircase take effect?
The changes do not take effect until 30 September 2026.
164
What is the deadline for the 2nd staircase requirement to take effect?
30 September 2026
## Footnote
The requirements will not apply to buildings that have “significantly progressed” by this date.
165
What is the purpose of a peer review for a loan security valuation?
Provides objectivity, counters bias, ensures ethical oversight, and improves overall work
## Footnote
Under VPGA 2, someone not involved with the valuation conducts the review.
166
What does due diligence (DD) include?
* Title plan
* Planning history
* Site boundary
* Flood risk
* EPC
* Council tax
167
How do you perform a conflict of interest check?
Using a CRM system
168
How many items are in a Transfer of Equity (TOE)?
18
169
What is the first step in your firm's complaints handling procedure?
Raise concerns with the contracting party detailed in the letter of engagement
170
What is RICS surveying safety 2018 concerned with?
* Responsibilities for members and firms
* Concept of a safe person
* Risk management
* Assessing risk
* Place of work
* Visiting premises or site
* Fire safety
171
What are the responsibilities of employers regarding health and safety?
* Duty of care to prevent risk to health
* Ensure a safe workplace
* Provide safe equipment
* Employ competent staff
172
What is the statutory guidance for health and safety?
Health and Safety at Work Act 1974
173
What personal protective equipment (PPE) is needed on a development site in Nine Elms?
* Hat
* Gloves
* High Vis
* Steel toe cap boots
174
Why is signing in and out of a visitor log book important?
Keeps records up to date in case of an emergency
175
What are the IFRS reporting standards?
Set of accounting rules for financial statements of public companies
176
How often does a firm need an audit?
Once a year every year
177
What is strategic business planning?
Process to map out vision for growth and how to achieve it
178
What is included in a conflict assessment?
* Identify source of conflict
* Look beyond the incident
* Request solutions
* Identify solutions
* Agreement
179
What are the RICS Rules of conduct?
5 rules, effective February 2022
180
What is the UK Data Protection Act 2018 about?
Right to find out what information is stored about you and request erasure or objection to processing
181
What are the UK general data protection regulations 2018?
UK's implementation of GDPR, including recordkeeping and data protection officer requirements
182
What is third-party data?
Data collected that does not directly interact with customers or business data consumers
183
What is your firm's diversity and inclusion policy?
Promote equality and ensure an inclusive culture
184
What are the benefits of a diverse workforce?
* Productivity
* Skills
* Perspective
* Creativity
* Supports innovation
185
What does the Equality Act 2010 protect against?
Discrimination in the workplace based on 9 protected characteristics
186
What are the MEES regulations?
Introduced to improve quality and increase energy efficiency of private rented houses and buildings
187
What are the changes to MEES effective from 1st April 2020?
* E or above required
* C or above for new lettings by 2025
* Continuing tenancies by 2028
188
What does ESG stand for and why is it important?
Environmental, Social, and Governance; it helps identify risks and improve social responsibility
189
What is AML?
Anti-money laundering
190
What procedures would you undertake to start your own firm?
* Inform RICS of firm details
* Appoint a Responsible Principle
* Register for regulation
* Arrange PII and send to RICS
191
What is a bye-law?
The rules of a professional body
192
What is the actual amount of cash you can accept?
10,000 euros
193
What is bias?
Prejudice for or against one person or group
194
How can you prevent unconscious bias?
* Undertake training
* Assessments for unconscious bias
* Consider different perspectives
195
What must you do if you carry out a desktop valuation?
Agree this with the client in signed ToE
196
What are some of the principles of the Bribery Act?
* Top-level commitment
* Proportionality
* Risk assessment
* Due diligence
* Communication
* Monitoring and review
197
What are the four levels of RICS membership?
* Fellow (FRICS)
* Member (MRICS)
* Associate (AssocRICS)
* Trainee/Student
198
When was the RICS founded?
1868
199
Who is the current president of the RICS?
Tina Paillet
200
What is the Bichard Review?
* Independent review clarifying RICS purpose
* Making recommendations on governance structure
* Reporting in June 2022
201
What is your company’s policy on gifts?
Any gift over £200 cannot be accepted and must be logged
202
What would you do if you received a gift during a valuation?
Assess its value and log it with my director
203
What must you check before accepting an instruction?
• Professionally competent to carry out the instruction
• No conflicts of interest present
• Confirm terms of engagement in writing and have written approval from the client before starting work on an instruction
## Footnote
This ensures ethical compliance and protects both the professional and the client.
204
When would you decline an instruction?
• Not competent to undertake the work
• Insufficient facts on the issue
• Conflict of interest
• PII cannot be agreed
• Client on the UK government's sanctions list
• Would not be content for actions to be made public
## Footnote
These guidelines help maintain professional integrity.
205
What are the three types of conflicts of interest?
• Party conflict: work on the same or related instruction for two different parties
• Own interest conflict: relating to a personal interest
• Confidential information conflict: work between two parties that is confidential
## Footnote
Understanding these conflicts is crucial for ethical decision-making.
206
What is informed consent?
Written authority from a client to proceed with an instruction if a potential conflict of interest arises, given under full transparency about material factors.
## Footnote
Surveyors should only seek informed consent if all relevant parties are best served.
207
How should you handle clients' money?
• Keep client accounts separately and clearly identifiable
• Ensure 'client' is on the bank account and cheque book
• A client must be able to access their monies on demand
• Interest should be accrued to the client
## Footnote
Proper management of client funds is essential for trust and compliance.
208
What are MEES?
Minimum Energy Efficiency Standards that set the minimum energy efficiency for properties rented in the private sector.
## Footnote
This regulation aims to improve energy efficiency and reduce carbon emissions.
209
What are some exemptions for MEES?
• Properties with low rental value
• Short-term leases
• Certain types of buildings such as listed buildings
## Footnote
Exemptions ensure that the regulations are practical and do not impose undue burdens.
210
What is the Data Protection Act?
A law that governs how personal data is processed and stored, ensuring individuals' privacy rights are protected.
## Footnote
It was implemented to provide a framework for data protection in the UK.
211
What is the purpose of GDPR?
To enhance individuals' control and rights over their personal data and to unify data protection regulations across Europe.
## Footnote
GDPR stands for General Data Protection Regulation.
212
What are some individual rights listed on GDPR?
• Right to access
• Right to rectification
• Right to erasure
• Right to restrict processing
• Right to data portability
## Footnote
These rights empower individuals regarding their personal data.
213
What is the difference between GDPR and the Data Protection Act?
GDPR is a regulation that applies across the EU, while the Data Protection Act is UK law that implements GDPR provisions and adds additional rules.
## Footnote
The Data Protection Act is tailored to the UK's legal framework.
214
What does RICS cover in their health and safety guidance?
Guidance on managing risks and ensuring the safety of individuals in the workplace.
## Footnote
RICS stands for the Royal Institution of Chartered Surveyors.
215
What is a sole agent?
An agent who is exclusively authorized to sell a property on behalf of the client.
## Footnote
This arrangement often includes specific terms regarding commissions and responsibilities.
216
What are the different methods of sale?
• Private treaty
• Informal tender
• Formal tender
• Auctions
## Footnote
Each method has its own process and suitability depending on the property type.
217
What is auction?
A method of sale where properties are sold to the highest bidder in a public forum.
## Footnote
The auction process includes marketing, due diligence, and bidding.
218
What is SDLT?
Stamp Duty Land Tax, a tax applied on property purchases in the UK.
## Footnote
SDLT rates can vary based on the property price and whether the buyer is a first-time buyer.
219
What is hope value?
The potential future value of a property based on expected future development or changes in the market.
## Footnote
Hope value is often considered in property appraisals.
220
What is included in your pre-inspection checklist?
• Conduct a risk assessment for safety
• Contact details of the site manager for PPE needs
• Local area and transport information
• Print necessary documents such as a disto, notebook, and camera
## Footnote
A thorough checklist ensures a safe and productive inspection.
221
How do you assess profit margins?
By evaluating revenues against costs to determine the financial viability of a project.
## Footnote
Profit margin analysis is crucial in investment decision-making.
222
What was included on your sales memorandum when you agreed the sale?
Details about the property, terms of sale, and any conditions agreed upon by the buyer and seller.
## Footnote
This document serves as a formal record of the sale agreement.
223
What is the auction process?
The bidding process typically takes place in an auction house where bidders bid in front of each other, and the gravel indicates the highest and final bid.
224
What does Section 18 of the Estate Agency Act require?
Disclosing fees and charges to clients.
225
What does Section 21 of the Estate Agency Act require?
Disclosing personal interests.
226
What types of data are included in a data tracker?
Qualitative data such as viewing feedback and quantitative data such as the number of sales, viewings, and enquiries.
227
Is there current RICS guidance for data management?
Not at the moment.
228
What is the penalty for breaching GDPR?
Up to £17.5 million or 4% of annual worldwide turnover, whichever is higher.
229
Who polices GDPR?
Information Commissioners Office.
230
List the consumer rights under GDPR.
* The right to be informed
* The right of access
* The right to rectification
* The right to erasure
* The right to restrict processing
* The right to data portability
* The right to object
* Rights in relation to automated decision-making, including profiling
231
How long can client data be stored in an agency?
Up to 6 years unless the client requests removal.
232
What are some compulsory actions in RICS Professional Standard Valuation of Development Property?
* Sensitivity analysis
* Cross check with comparable land evidence.
233
How do you adhere to the Estate Agents Act?
By verifying information provided to applicants and handling clients' money appropriately.
234
What referencing requirements do you look for from an applicant?
* AML checks
* LL referencing
* Affordability referencing
* Regular income and employment checks.
235
Do you carry out referencing checks yourself?
Yes, using a software called HomeLet.
236
Where does HomeLet get its data from?
* Experian
* Companies House
* A range of sources.
237
How would you carry out referencing checks without HomeLet?
* Ask for previous LL details for a reference
* Ask the client to complete a credit score check
* Request bank statements to check regular income.
238
If a landlord wants to regain possession mid-tenancy, what can they do?
* Action Section 8 with grounds
* Deem surrender if both LL and T agree
* Use Section 21 for no-fault eviction at the tenancy's end.
239
How do you consider sustainability in valuations?
* ESG credentials such as EPCs, ASHP, and solar panels
* Adjust comparable evidence for ESG factors.
240
Why consider EPCs and sustainable features in valuations?
Non-compliance increases asset risk, affecting yield opinions for BTR valuations.
241
Is there noticeable demand for sustainability features from investors?
Yes, especially in BTR CM, as it helps meet ESG targets.
242
What are the three types of agency?
* Sole
* Joint
* Multiple.
243
What are the four methods of sale?
* Formal
* Informal
* Private treaty
* Auction.
244
What should you consider when choosing a method of sale?
* Client's objectives
* Timing requirements
* Certainty of sale
* Demand for the property
* Current and future market conditions.
245
What is the Renters Rights Bill?
A bill impacting the rental industry (details not specified).
246
What are the limitations of a market appraisal?
Details not specified in the text.
247
What are the five methods of valuation?
Details not specified in the text.
248
What is the definition of Market Rent?
Details not specified in the text.
249
When does a BTR scheme reach stabilization?
Details not specified in the text.
250
What is a special assumption?
Details not specified in the text.
251
What is a Net Initial Yield?
Net operating income / purchase price.
252
What is the usual level of profit on cost acceptable in a development appraisal?
Details not specified in the text.
253
What is IPMS?
Details not specified in the text.
254
How does IPMS differ from the code of measuring practice?
Details not specified in the text.
255
How is GIA different from NIA?
Details not specified in the text.
256
Who enforces the UK GDPR Rules?
ICO (Information Commissioners Office).
257
What are some key requirements of UK GDPR?
* Rights for individuals to access their personal data
* Data accountability
* Reporting data security breaches within 72 hours.
258
How does your firm ensure that client data is protected?
* Firewalls
* Encrypted files
* Password protected documents.
259
What is the purpose of the RICS?
Details not specified in the text.
260
What is unconscious bias?
An internal bias based on personal experiences, education, and upbringing.
261
What is professional scepticism?
Details not specified in the text.
262
What are the main principles of the Bribery Act?
Details not specified in the text.
263
What is the difference between a gift and a bribe?
Details not specified in the text.
264
Can you accept a referral fee?
Details not specified in the text.
265
What is the payment for membership to the RICS?
266
Who is the incoming president elect of the RICS?
267
What is the difference between a gift and a bribe?
268
Name a topical issue that is going on with the RICS at the moment.
269
Can you accept a referral fee?
270
What can you do if you are unable to get PII on the open market?
271
Fill in the blank: The annual target of your team is _______.
£5.5m
272
What is an example of a recent economic event that impacts residential real estate?
Base rates starting to come down, cheaper borrowing, higher demand for properties, prices should stabilize
273
What are some of the individual rights within GDPR?
* The right of access
* The right to rectification
* The right to erasure
* The right to restrict processing
* The right to data portability
* The right to object
* The right not to be subject to a decision based solely on automated processing
274
What was the date the Data Protection Act came into force?
1998 and updated in 2018
275
What are some limitations of a market appraisal?
* Not red book so cannot be formally relied upon
* Has some forecasting and hope value, making comparison difficult
276
What are the main principles behind the Blue Book?
* Code of behavior for estate agency
* Duty of care
* Not discriminating
* Dealing with conflicts of interest
* Providing accurate information
277
Can you define an estimated rental value?
The current rent at which space within a property could reasonably be expected to be let given current market conditions
278
How could the Renters Right Bill impact the private rental sector when it becomes law?
It will shift rights more in favor of tenants, potentially making property less attractive as an investment to landlords
279
What are some of the different types of tenancy agreements?
* ASTs
* Excluded Tenancies
* Company Let
280
How do you ensure you adhere to the Health and Safety Act 1974?
I follow my company's health and safety policies, complete required training, and report any incidents or injuries
281
What is PPE?
Personal Protective Equipment
282
What are the three financial statements?
* Income statement
* Balance sheet
* Cash flow statement
283
What are the key principles of surveying safely?
* Safe working environment
* Safe work equipment
* Safe systems of work
* Competent staff
284
What are the main provisions of the Bribery Act?
* Proportionate Procedures
* Top Level Commitment
* Risk Assessment
* Due Diligence
* Communication (including Training)
* Monitoring and Review
285
What are the penalties for non-compliance with the Equality Act?
Fine up to £5,000
286
What is a reasonable adjustment?
Effective, practical, and cost-effective modifications to ensure accessibility
287
What are the 9 protected characteristics under the Equality Act 2010?
* Age
* Gender assignment
* Sex
* Sexual orientation
* Disability
* Race
* Religion/belief
* Marriage or partnership
* Pregnancy or maternity
288
What does an inclusive mindset mean?
A way of thinking that values diversity and fosters inclusivity
289
What are skills for effective teamwork?
* Listening
* Discussing
* Persuading
* Respect
* Helping
* Sharing
* Communicating
290
When were the RICS rules of conduct published and when did they become effective?
Published in 2021 and became effective in 2021
291
What does good quality service look like?
Active communication with clients, setting objectives, and delivering work on time
292
What are some requirements for RICS members and firms?
* Comply with CPD requirements
* Cooperate with RICS
* Promptly provide information requested by Standards and Regulations Board
293
What is the process of performing an AML check?
Confirm the buyer's identity and proof of address through ID and a utility or council tax bill from the last 3 months
294
What would some typical red flags be during an AML check?
If someone is highlighted as a politically exposed person after customer due diligence (CDD)
295
What is the role of an agent when a buyer has been found?
Call landlord/vendor, put offer in writing, agree terms, sort AML, draft memorandum of sale, and assist with conveyancing
296
What is the importance of active communication with clients?
Setting out objectives and delivering work on time
297
How do you ensure compliance with the rule of conduct regarding diversity and inclusion?
Actively engage everyone so they feel heard
298
Give an example of treating someone with respect.
Honouring their time, being kind, and listening to them
299
How can a firm encourage diversity and inclusion?
Creating spaces where people feel welcome and supporting open recruitment
300
What does acting in the public interest mean?
Ensuring that any work I complete I would be happy to be made public
301
What are the professional obligations relevant to your firm?
PI, complaints handling, complaints officer
302
What is the timescale for RICS to acknowledge complaints?
21 days to acknowledge
303
How long does a complaint need to be acknowledged after it is logged?
7 days
304
Why does your firm have professional indemnity insurance?
To protect against claims of negligence
305
What would you do if a colleague asked you to take an inappropriate course of action?
Refer to another colleague and look at RICS ethics tree
306
What should be included in standard terms of engagement?
Identify property, client, valuer, bases of value, currency, scope of work, valuation date
307
Is it advisable to begin work without signed terms of engagement?
Preferably no
308
What type of due diligence could you carry out before receiving signed terms?
Looking at comps, due diligence, but not sending client anything
309
What is the difference between a guidance note and a professional statement?
Professional statements are mandatory
310
What are some additional issues with hospitality gifts?
Issue of proportionality
311
What are some principles of the Bribery Act?
* Top level commitment
* Proportionality
* Risk assessment
* Due diligence
* Communication
* Monitoring and review
312
What professional obligations must members and firms follow?
* Comply with CPD requirements
* Cooperate with RICS
* Provide information requested by the Standards and Regulation Board
313
Why did the rules of conduct change?
* To provide a simpler structure
* To focus on diversity and inclusion
* To focus on sustainability and tackling climate change
314
When was the RICS founded?
1868 and it received its royal chartership in 1881
315
Who is the current president of the RICS?
Ann Gray
316
What are the four levels of membership in RICS?
* Fellow (FRICS)
* Member (MRICS)
* Associate (AssocRICS)
* Trainee / Student
317
What is required to become a Fellow of RICS?
* Five or more years at MRICS
* A leadership role
* Professional / technical achievement
* Academic achievement or raising the profile of RICS
* A portfolio of professional achievement
318
What is the governance structure of RICS?
* Governed under royal charter by various councils and boards
* Governing Council – 25 members
* Regulatory Board – management board
319
What is the Bichard review?
An independent review to clarify the purpose of the RICS and its responsibilities
320
How do you represent the RICS positively?
* Act with honesty and integrity
* Ensure competence and provide high quality service
321
How do you maintain client confidentiality?
* Use a secure filing system
* Maintain a clear desk policy
* Do not discuss work outside the project
322
What is your company’s policy on gifts?
Any gift over £200 cannot be accepted and must be logged
323
What is your company’s complaints handling procedure?
* Refer complaint to director if not handled personally
* If unresolved, pass to legal and compliance team
* Final response to be provided within 8 weeks
324
What does RICS complaints handling state?
* Written procedures must be approved by RICS
* Complaints must be acknowledged within 7 days
* Firms must include an RICS approved ADR mechanism
325
What does the Bribery Act (2010) state?
A bribe can be giving, offering, or receiving an advantage for an illegal action
326
What is bias?
Prejudice for or against one person or group
327
What is unconscious bias?
Prejudice or associations for or against a person or group that you are not aware of
328
How can you prevent unconscious bias?
* Undertake training and assessments
* Avoid rash decisions and consider different perspectives
329
How does a peer review work?
Taking a director or another member through a piece of work to justify assumptions
330
What due diligence do you undertake before accepting an instruction?
* Identify the client, asset, and borrower
* Undertake a conflict check
331
What are the limitations of a desktop valuation?
* Reliant on provided information
* Client must agree there has been no material change since previous valuation
332
What must you do if you carry out a desktop valuation?
Agree this with the client in signed ToE
333
How do you determine fees?
Fees are market-based and agreed on an ad hoc basis with clients
334
What must you do before accepting an instruction?
* Check professional competence
* Check for conflicts of interest
* Confirm terms of engagement in writing
335
When would you decline an instruction?
Using the RICS Ethics Decision Tree for various reasons
336
What types of conflict of interest are there?
* Any financial interest
* A personal interest
337
What are situations that may prevent you from accepting an instruction?
If you do not have sufficient facts, if there is a conflict of interest, if PII cannot be agreed, if the client is on the UK government's sanctions list, if you would not be content for your actions to be made public.
338
What types of conflict of interest are there?
* Any financial interest
* A personal interest
* Commercial relationships
* Acting on both sides of a transaction
339
What is conflict avoidance?
When you do not accept the instruction.
340
What is conflict management?
When the instruction is accepted and steps are agreed and put in place to manage the conflict.
341
What RICS guidance is there on conflict of interest?
* RICS Global Professional Statement on Conflicts of Interest 2017
* Guidance on informed consent
* All conflicts must be managed in accordance with the professional statement
* Every RICS firm must have effective systems and controls
342
What are the three types of conflicts of interest?
* Party conflict
* Own interest conflict
* Confidential information conflict
343
What is informed consent?
Given in writing by the party after full transparency about material factors.
344
How do you handle a conflict of interest?
* Consider if the conflict is resolvable
* Decide to accept or decline the instruction
* Provide written disclosure to clients
* Request informed consent in writing
* Set up an information barrier if accepted
345
What is the current limitation period for negligence in contract?
6 years from the date of the negligent act.
346
What is the current limitation period for negligence in tort?
6 years from the date the claimant suffered the loss.
347
How do you avoid being negligent?
* Clearly understand clients' objectives
* Ensure competency
* Undertake work according to RICS standards
* Keep detailed file notes
* Stay updated with market knowledge
348
How should you handle clients' money?
* Keep client accounts separate
* Ensure the word 'client' is on accounts
* Clients must have access to their money on demand
* Interest should accrue to the client
349
What steps must be taken to start a new RICS practice?
* Inform RICS with a Firm Detail Form
* Appoint a Responsible Principle
* Register for RICS regulation
* Ensure appropriate PII
* Appoint a complaints handling officer
350
What levels of PII are determined by a firm's turnover?
* £100,000 or less = minimum £250,000 indemnity
* £100,001 - £200,000 = £500,000 indemnity
* Over £200,001 = £1,000,000 indemnity
351
What statutory compliance must you adhere to?
* AML regulations
* Bribery Act 2010
* Health and Safety Act 1974
* Fire Safety Order 2005
* Data Protection Act 2018
352
What must you do to close a practice?
* Inform RICS of retirement or closure
* Inform clients and arrange handovers
* Return client monies
* Inform insurers and procure run-off cover
353
When would you undertake enhanced due diligence?
For transactions involving high-risk countries or politically exposed persons.
354
What is the limit for accepting cash in your firm?
My firm does not accept cash; the limit is 10,000 euros.
355
What are the penalties for tipping off someone after failed AML checks?
Up to 5 years in prison and unlimited fine.
356
What are some principles of surveying safely?
* Personal responsibilities
* Assessing hazards
* Workplace health and safety
* Occupational health and hygiene
357
What does surveying safely highlight about RICS regulated firms?
* Must provide a safe working environment
* Safe work equipment
* Safe systems of work
* Competent staff
358
What is included in an annual return?
* Nature of clients, business and staff
* Statutory regulated activities
* Details of complaints handling procedures
* Details of PII
359
What is a bye-law?
The rules of a professional body.
360
What could trigger disciplinary procedures by RICS?
* Complaints to RICS
* Allegations by clients or third parties
* Information received by RICS
361
What should you do if a colleague is posting offensive material online?
* Speak with the colleague
* Refer to their line manager if necessary
362
When is RICS unlikely to investigate a social media post?
If it is critical of an organization, uses respectful language, or is removed upon request.
363
Who polices AML?
National Crime Agency.
364
What is the legislation surrounding AML?
Money laundering, terrorist financing and transfer of funds Regulations 2017.
365
What should you do if you suspect someone is money laundering?
Submit a Suspicious Activity Report to the National Crime Agency.
366
How is SDLT paid?
Paid in incremental amounts based on the bandings.
367
What are the penalties under the Bribery Act?
* Unlimited fines
* 10 years in prison
368
Which rule of conduct mentions professionalism?
2nd and 5th rules.
369
Why did the rules of conduct change?
* To simplify the structure
* To focus on diversity and inclusion
* To address sustainability and climate change
370
What due diligence do you undertake before accepting an instruction?
* Competence
* Identify the client, asset, borrower, and lender
* Undertake a conflict check
371
How must social media be used according to RICS guidance?
* Avoid discrimination, abusive behavior, and dishonesty
* Critical posts about organizations may not be investigated
372
What is the main role of the RICS?
* Maintain high standards of education and training
* Protect consumers through regulation
* Be a leading source of information on land and property
373
What are the principles of the RICS president?
* Dignity
* Professionalism
* Excellence
374
What does the RICS Futures report address?
Changes in the profession and markets, responding strategically and sustainably.
375
What guidance does RICS provide on social media use?
RICS guidance (2021) advises on the appropriate use of social media, investigating posts involving discrimination, abusive behavior, bullying, or dishonesty.
376
What is the likelihood of RICS investigating critical posts about an organization?
RICS is unlikely to investigate posts that are critical of an organization if they use respectful language or are removed upon request.
377
Under what circumstances may RICS take disciplinary action regarding social media posts?
RICS may take disciplinary action against posts that are damaging to public confidence.
378
What legislation prevents work in Hayes?
Data protection.
379
What does AML stand for?
Anti-Money Laundering.
380
What data does smart search analyze?
Not specified.
381
What is the typical amount of Professional Indemnity (PI) insurance for a firm?
Not specified.
382
What is required if a property valued at £1.8m is agreed upon at £1m?
An AML flag.
383
What is the difference between the Data Protection Act (2018) and GDPR?
Data Protection Act is specific to the UK; GDPR applies to all businesses regardless of size and location.
384
Why was GDPR introduced?
Not specified.
385
What are the key principles of GDPR?
* Lawfulness, fairness, and transparency
* Purpose Limitation
* Data minimization
* Storage Limitation
386
How long do you have to report a data breach?
72 hours.
387
What are the maximum fines for a data breach?
4% of turnover or €17.5 million.
388
How long do you store clients' data in agency?
6 years.
389
What is ground rent?
A regular payment made to the freeholder of a leasehold property as a condition of the lease.
390
What is a service charge?
A fee payable to the landlord/freeholder by the leaseholder for services provided under the lease.
391
Who polices residential boards?
Local planning authority.
392
What is the Land Registration Act 2002?
Legislation governing the registration of land ownership and interests in the UK.
393
What is a report on title?
A comprehensive overview of the legal status of a property detailing rights, restrictions, or issues.
394
What are heads of terms?
A document setting out the terms of a commercial transaction agreed in principle between parties.
395
What is a sale and purchase agreement?
A binding legal contract obligating a buyer to buy and a seller to sell a product or service.
396
What is conveyancing?
The legal process of transferring ownership of a home from one person to another.
397
What are title deeds?
Documents proving the ownership of a property and its history.
398
How do you ensure adherence to the Health and Safety Act 1974?
Competent training, risk assessment, safe person, evacuation plan.
399
What is the annual target of your team?
Aim to work on 300 different developments a year.
400
What are physical features of your workplace for neurodivergent individuals?
* Quiet places of work
* Dim lighting in pods.
401
What does EWS1 form stand for?
External Wall System.
402
What does MEP stand for?
Mechanical, Electrical, and Plumbing.
403
What is the consequence of sharing confidential information?
Not specified.
404
What are the potential consequences for violating the Bribery Act?
Not specified.
405
What is an estimated rental value?
The estimated amount for which an interest in real property should be leased between a willing lessor and lessee.
406
What are the three financial statements?
* Income statement
* Balance sheet
* Statement of cash flow
407
What methods of sale have you used?
* Private Treaty
* Informal Tender
408
What are the key principles of surveying safely?
Not specified.
409
What would you do if you accidentally gave someone access to the UK BTR database?
Not specified.
410
What is the process of performing an AML check?
Not specified.
411
How would you secure data when working in a café with public wifi?
Back to wall, headphones, and VPN (encryption).
412
If you didn't have the radar system, how long would you hold this information?
Not specified.
413
What are the main provisions of the Bribery Act?
Not specified.
414
Have you ever been given a gift in a professional context?
I have not personally been given a gift.
415
Can you give an example of when you negotiated with a client?
Negotiated for a furniture pack to be added to an apartment to improve saleability.
416
How do Microsoft Teams calls facilitate effective communication?
Allows for event creation, reminders, file sharing, and easy modification.
