Important Qs Flashcards
Principles of GDPR
- Lawfulness, fairness and transparency
- Purpose limitation
- Data minimisation
- Accuracy
- Storage limitation
- Integrity and confidentiality (security)
- Accountability
Rights of individuals under GDPR
- Right to be informed
- Right of access
- Right to rectification
- Right to erasure
- Right to restrict processing
- Right to data portability (to use for their own purposes)
- Right to object
- Rights to automated decision making and profiling (as undertaken by insurance companies)
Principles of GAAP
- Regularity
- Consistency
- Sincerity
- Permanence
- Non-compensation
- Prudence
- Continuity
- Periodicity
- Materiality
- Utmost good faith
Profit/Accounts method calculation
Turnover (net of VAT)
Less Costs of generating the Turnover
= Net Operating Profit
Which is Capitalised
Contractors/depreciated replacement cost calculation
Gross Replacement Cost
Cost of Modern Building
LESS Depreciation (£ )
Net Replacement Cost £
PLUS Site Value £
Value as Existing
What is GEA?
The area of a building measured externally at each floor level
What is GIA?
The area of a building measured to the internal face of the perimeter walls at each floor level
What is NIA?
The useable area of a building, measured to the internal face of the perimeter walls at each floor level
What is IPMS 1?
The sum of the areas of each floor level of a building measured to the outer perimeter of external construction features, and reported on a floor by floor basis
Universal standard that applies to all building classes
What is the difference between IPMS 1 and GEA?
Internal balconies are included in GEA, and included but stated separately in IPMS 1
External balconies are excluded in GEA, and included but stated separately in IPMS 1
Accessible rooftops are excluded in GEA, and included but stated separately in IPMS 1
What is IPMS 2?
The sum of the area of each floor level of a building measured to the internal dominant face, and reported on a component by component basis for each floor of a building
What is the difference between IPMS 2 and GIA?
Internal balconies are included/excluded in GIA, and included but stated separately in IPMS 2
External balconies are excluded from GIA, and included but stated separately in IPMS 2
Accessible rooftops are excluded in GIA, and included but stated separately in IPMS 2
Areas occupied by the reveals of windows when measured as the internal dominant face, are excluded in GIA and included in IPMS 2
What is IPMS 3?
The floor area available on an exclusive basis to an occupier, excluding standard facilities, calculated on an occupier-by-occupier basis for a building
What is the difference between IPMS 3 and NIA?
Internal walls and columns are excluded in NIA, and included for IPMS 3
Common walls with adjacent occupier are measured to dominant face in NIA, and centre line with IPMS 3
Enclosed walkways or passages excluded from NIA, but included in IPMS 3
Valuation assumptions
- Title
- Condition of buildings
- Services
- Planning (zoning)
- Contamination and hazardous substances
- Environmental matters distinguishing between:
a) Natural environmental constraints
(b) Non-natural constraints (contamination and hazardous substances).
(c) Sustainability – assessing the implications for value
When is MEES changing?
Minimum MEES threshold will rise from an E to C by 2027 and to B by 2030
MEES legislation
Minimum Energy Efficiency Standards, 2015
April 2018 - illegal to let unit at F or G
April 2023 - illegal to continue to let F or G
Buildings that do not require an EPC
- Listed buildings
- buildings without heating
- religious buildings
- temporary buildings
- buildings due to be demolished/redeveloped
- residential units not occupied for more than 4 months of the year
CRAR Act
Tribunals, Courts and Enforcement Act 2007
What is a tender process?
procurement – for best competitive service for the price. It is recommended contracts are tendered every 3 years by the RICS.
Difference between net effective rent and headline rent
NER = calculation of average monthly rental cost that incorporates landlord rental concessions, typically a free month of rent
Headline = The rent that would be payable after any rent-free period, concessionary rent period or other inducement has expired
Factors that may negatively impact a valuation that may be observed on an inspection
- Asbestos
- Contamination
- Flooding
- Invasive species
- High voltage overhead cables
What legislation covers inspections?
- Health and Safety at Work Act 1974
- RICS Surveying Safely 2018
Sections of surveying safely
- Health and Safety requirements of firms and individuals
- Hazard and Risk Assessment
- Fire Safety Checks
- Contractor Management
- Residential section
In broad terms, how would you undertake an inspection in accordance with Surveying Safely?
- Pre site risk assessment
- Inspect local area
- External inspection
- Internal inspection
What’s the difference between and inherent defect and a latent defect?
o Inherent defect is a defect in design or material which has always been present
o Latent defect is a fault to the property that couldn’t have been discovered by a reasonably thorough inspection of the property
Can you name the 9 mandatory obligations for RICS firms and members set out in SC & Com property 2018?
- Not to recover more than 100% of the proper actual costs
- Service Charges must be issued annually to all tenants.
- A signed statement showing actual expenditure must be provided to the tenants annually.
- All interest earned on S/C accounts must be credited to the service charge account after appropriate deductions (bank charges, tax etc) have been made.
- All costs must be transparent so that parties are aware of how they are made up.
- The basis and method of apportionment of costs should be fair and reasonable.
- When issuing statements of accounts or certifying expenditure PMs must act in a non partisan way acting as experts.
- Independent review of the service charge should be undertaken .
- Produce quality service standards to ensure that value for money is achieved at all times = effective value for money rather that the lowest price.
Process of rent review
- Receive written instruction form client
- Check conflict of interest
- Terms of engagement?
- Agree fees
- Check lease
- Inspect and measure the property
- Gather comparable
- Make calculations
- Present to client
- Seek further instructions
- Negotiate with tenant
- Sent to solicitor to document in rent review memorandum
Process of lease renewal
- Understand client objectives/receive instruction
- Check independence (conflict of interest check) and competence
- Send terms of engagement inc complaints handling procedure and the fee basis
- Review documentation and the lease (licenses, assignments) – find out if the tenant has security of tenure or if an exclusion clause is in the lease (clauses 24-28). If the lease is inside the act a Section 25 notice will need to be served in order to bring the tenancy to a formal end.
- Inspect the local area, exterior and interior of the property
- Measure
- Gain comparable evidence
- Write a valuation report and get it checked for QA
- Report to client and advise them of the market value and advise on strategy for when to serve the section 25 notice.
- If there is an uplift in rent, the notice should expire in line with the contractual term end date. If no uplift, the date that you serve notice on is less important
- If the notice is not served upon expiry of the contractual term, the tenant begins to ‘hold over’ where the existing lease will carry on until a notice is served.
- Instruct a solicitor to serve a section 25 notice which will include:
Subject property
Landlord and tenant details
‘friendly or hostile’
Friendly – notice of new rent
Hostile – reason for termination
Date for the new lease to begin.
Negotiate and agree terms
Prepare heads of terms
Instruct solicitor to prepare and complete new lease
Outside Act lease renewal
- Understand client objectives/receive instruction
- Check independence (conflict of interest check) and competence
- Send terms of engagement inc complaints handling procedure and the fee basis
- Review documentation and the lease (licenses, assignments) – find out if the tenant has security of tenure or if an exclusion clause is in the lease (clauses 24-28).
- Inspect the local area, exterior and interior of the property
- Measure
- Gain comparable evidence
- Write a valuation report and get it checked for QA
- Report to the client on advise of market value
- Receive instructions to negotiate with the tenant – landlord has strong negotiating power in this instance
- Agree the new rent and terms in advance of the lease expiry date
- Instruct solicitors to handle the renewal
Licence to alter process
- Read the lease – (alterations clause) can they undertake works
- Tenant to Provide detailed plans – full proposed specification of works (include existing and proposed) structural calculations if required, confirm they have relevant planning (if required), building regs consent & RAMS.
- Inform tenant they are NOT permitted to commence works until we have granted permission and to do so is a serious breach of lease terms. Inform tenant you are only considering their proposal until you obtain clients permission.
- There is no room for discussion. They have to pay the costs and they have to do so upfront unless they give a solicitors undertaking for that amount.
- Agree undertaking of costs (these fees are none negotiable) Please note these fees are payable even if the license to alter does not complete. Workman also reserve the right to increase their fees if the license to alter becomes problematic and time consuming, I,e numerous tenant queries.
o PM’s fee for reviewing the plans and specification and re inspecting £950 plus VAT - check fees
o Landlord solicitor’s fee of £1,500 + VAT to be confirmed - check fees
o Building surveyor’s fee of £750 + VAT to be confirmed - check fess - Subject to the lease allowing works to be undertaken, have a conversation with the client and email them a summary of the works. Ensure reinstatement clause is inserted.
- Subject to fees being agreed, & obtaining client approval, instruct building surveyors and landlord solicitors to document license to alter.
Assignment process
- Read the lease and check the alienation clause (see if Landlord consent is required)
- Landlord can withhold consent if:
1. Any arrears are outstanding
2. Tenant is in breach of the lease
3. Assignee is not of the same financial standing as assignor - Agree undertaking of costs
- Ascertain if it is market/passing rent
- Check assignee covenant strength. If it is weak then it can be refused
- Has a deposit/ AGA been agreed
- Produce a recommendation to the client – get it approved
- Ensure license to assign is documented via solicitors
