Need work Flashcards
What are the differences in IMPS 3 and NIA?
- IPMS 3 - perimeter measurements taken to the internal dominant face
- IPMS 3 - No exclusions for restricted height of less than 1.5m
- IPMS 3- All columns are included
- IPMS 3 - On floor with multiple occupiers, the area is taken to the midpoint of the partition wall between tenancies
- IPMS 3 - Covered galleries and balconies for the exclusive use of one tenant are included and stated separately
What does the RICS Global Professional Standard: Conflict of Interest, 2017 cover?
That a member cannot advise or represent a client when a conflict is present or if there is a risk of one.
Unless when parties have given their ‘informed consent’ in writing.
What happened in Yianni v Edwin Evans (1981)?
Established that a Resi valuer instructed by a mortgager lending institution could owe a duty of care in tort to a mortgage purchaser relying on a valuation
What happened in Burgess v Lejonvarn (2020)?
Established that professionals providing services pro bono and without a contract owe a duty of care in tort to act with reasonable care and skill in respect of services they provide. However, the Court of Appeal also determined that they are not under a duty to advise or give warnings, and nor are they liable for work they do not do.
What is the latest PII Professional Statement?
RICS Professional Indemnity Insurance Requirements, July 2024
Who is the acting President of the RICS?
Who is the CEO of the RICS?
Nick MacLean on a temporary basis
Justin Young
What are the 6 key principles of the Bribery Act 2010?
- Proportionality
- Top level commitment
- Risk Assessment
- Due Diligence
- Communication
- Monitoring & Review
What is the Money Laundering, Terrorist Financing and Transfer of Funds Regulations, 2017?
It covers regulations for estate agency work and ‘relevant financial business work’ inside and outside the UK by a firm
Name 5 of the 9 provisions of Money Laundering, Terrorist Financing and Transfer of Funds Regulations, 2017?
- Requirement to have written ML & TF risk assessment
- Implement systems and procedures to address ML and TF risks
- Adopt appropriate internal controls
- Provide staff training
- Comply with new customer DD requirements
What do Level 1 (Customer) Money Laundering Due Diligence checks involve?
- Identity verification e.g. Passport
- Make ‘reasonable endeavours’ to identity the beneficial owners of the client.
- Names of the directors within the company
What is the Bribery Act 2010?
The Act is the main Bribery legislation and aims to reduce bribery in the UK and Abroad
Who is the Savills Compliance Officer?
Melissa Shaw
What is the main RICS Professional Standard for the Comparable method?
RICS Professional Standard: Comparable Evidence in Real Estate Valuation, 2019
Describe the formal for a term and reversion valuation?
- Current rent: £40,000 per year
- Market rent: £50,000 per year
- Lease expires in 5 years
- Capitalisation rate (yield): 8%
- Present value factor for 5 years at 8%: 0.6806
- Present value of £1 after 5 years at 8%: 0.6806
Step One: Term Value
= £40,000 × 5 × 0.6806 = £136,120
Step Two: Reversionary Value
= £50,000 ÷ 0.08 × 0.6806 = £425,375
Step Three:
- Total Value = £136,120 + £425,375 = £561,495
0.6806 is calculated:
1 over (1+ 0.08) to the power for 5
0.08 = Yield
5 = term remaining
Describe the formal for a term and reversion valuation?
Let’s say:
- Current rent = £40,000
- Market rent (ERV) = £50,000
- Lease expires in 5 years
- Yield (ARY) = 8%
- Discount rate = 8%
- PV factor for 5 years at 8% = 3.9927 (annuity factor)
Step 1: Capitalise Market Rent
£50,000 / 0.08 = £625,000
Step 2: Calculate Shortfall
£10,000 per year (difference) × 3.9927 = £39,927
Step 3: Subtract Shortfall
£625,000 - £39,927 =£585,073
0.39927 is calculated:
PV(annuity)= 1 - (1+0.08) -5 / 0.08
What are the 6 Bases of Value?
- Market Rent
- Market Value
- Fair Value
- Investment Value
- Equitable Value (not used in UK)
- Liquidation Value (not used in UK)
What does PS 1 cover?
Compliance with standards where a written valuation is provided
What does PS 2 cover?
RICS Professional and Ethical Standards
What must RICS members do under PS 2?
Members undertaking Valuations must act in accordance with the RICS Rules of Conduct, 2021
The Valuer and Firm must act objectively and independently always and not be influenced by any situation which could threaten professional objectively
Under VPS 1 how many many minimum matters are there for Terms of Engagement?
19
Name 5 of the 19 minimum matters required under VPS 1 for Terms of Engagement?
- Identification and status of the valuer
- Identification of client
- Identification of any other intended users
- Asset to be valued
- Currency
What does VPS 2 relate to?
Bases of Value, Assumptions and Special Assumptions
What does VPS 3 relate to?
Valuation Approaches and Methods
What does VPS 4 relate to?
Inspections, Investigations and Records
What does VPS 5 relate to?
Valuation Models (New in 2024)
What does VPS 6 relate to?
Valuation Reports
How many requirements are there under VPS 6 (Valuation Reports)?
Name 5 requirements
17
- Identification and status of the responsible valuer
- Client and any other intended users
- Purpose of the valuation
- Identification of the asset(s) to be valued
- Basis of value
What is the Case Law for Ransom Strips?
Stokes vs Cambridge Corporation 1961
What is the definition of Margin of Error?
The permissible range allowed by courts, for example in respect to valuation.
What did Singer & Friedlander Ltd v J D Wood 1977 establish?
Established that the Margin of Error would be narrower for easier for more simple valuations and wider for more complex valuations.
What did K/S Lincoln & Others v CBRE 2010 establish?
Established a Margin of Error of:
- 5% for standard Residential Property
- 10% for ‘one off’ commercial property
- 15% if a property has exceptional features
What are VPGA’s
Valuation Practice Guidance Applications
How many VPGA’s are there?
11
What does VPGA 2 cover?
Valuations for secured lending.
Notes that:
- ‘Any previous, current or anticipated involvement with the prospective borrower or the property to be valued must be disclosed to the lender’.
- If involvement creates a Conflict of Interest then the instruction should be declined.
What is an assumption in valuation?
Where it is reasonable for the valuer to accept that something is true without the need for specific investigation
What are special assumptions?
An supposition that is taken to be true and accepted as fact, even though it is note true
What are the Stamp Duty thresholds as of 1st April 2025 for Residential property?
Up to £125,000 - 0%
£125,001 to £250,000 - 2%
£250,001 to £925,000 - 5%
£925,001 to £1.5m - 10%
Over £1.5m - 12%
What is the basic premise of a WAULT?
Its a calculation used when valuing an asset of multi-occupied investments
How do you calculate Net Effective Rent?
A ‘straight line basis’ until the next lease event
What are the 7 key points of the Estate Agency Act 1979?
- Clarity in terms (Section 18)
- Honesty & Accuracy
- Agreement and liability costs
- Conflicts of Interest (Section 21)
- Absence of discrimination
- Legal obligation to tell the client about offer received
- Keep clients money separate
Where would the Estate Agency Act 1979 apply?
4 areas:
1. Disposal or acquisition of a property
2. Freehold property
3. Leasehold property with capital value
4. Land as well as buildings
What does the Consumer Protection from Unfair Trading Regulations 2008 cover?
That businesses must act with professional integrity and not distort information provided to a consumer?
What does the Fire Safety Act 2021 require?
Requires for a “responsible person” to assess, manage and reduce fire risks.
Requires regular lift inspections which are reported to fire & rescue services.
What are the differences in IMPS 3 and NIA?
- IPMS 3 - perimeter measurements taken to internal dominant face
- IPMS 3 - No exclusions for restricted height of less than 1.5m
- IPMS 3- All columns are included
- IPMS 3 - On floor with multiple occupiers, the area is taken to the midpoint of the partition wall between tenancies
- IPMS 3 - Covered galleries and balconies for the exclusive use of one tenant are included and stated separately
What is included in NIA for Offices?
- Kitchens
- Built-in cupboards
- Non-structural walls (separating occupiers)
What is excluded in NIA for Offices?
- WC’s
- Stairwells
- Areas less than 1.5m in height
- Cleaners rooms
- Plant rooms
What would you consider when inspecting the local area?
- Local Facilities: Public Transport, Other businesses present
- Hazards: Flooding, Site Contamination
- Local market: Other available properties with agents boards
What is CAT B fit out for offices?
Where a space is fitted to a basic standard for a occupier to do ‘Enhanced finishes’ to complete.
What are Dun and Bradstreet Reports?
A tool to assess the financial health and risk profile of a business.
What are the 3 most common causes of a building defect?
- Movement
- Water
- Defective materials
How do you use a Dun and Bradstreet Report?
- Search Business name
- D-U-N-S® Number (unique ID) needed
- Address and contact info
How many parts are there is Dun & Bradsheet reports?
What does each part cover?
2
- Shows the Net Tangible Worth of the Business
- Shows the Risk of Default of the Business
They are measured on different scales
What’s included in a Dun & Bradsheet report?
A business is rated 1-5 for its risk of instability. 1 is the lowest
A measure of payment behaviour rated 1-100. 80+ means on time payments
Name 5 of the 8 individual rights under UK GDPR?
- Right to be informed
- Right to access
- Right to rectification
- Right to erasure
- Right to restrict processing
- Right to data proportionality
- Right to object
- Rights to Automated Decision Making and profiling
What is the Arbitration Act 1996?
It is the legislative framework regarding Arbitration
Why is Arbitration effective?
It is a fast, cost effective and confidential method of dispute resolution.
What is PACT? (Professional Arbitration on Court Terms)
A form of Alternative Dispute Resolution to tenancy renewals under the Landlord & Tenant Act 1954.
What must a surveyor be to act as an Expert Witness?
Competent in the said field
What are the 9 protected characteristics under the Equality Act 2010?
- Gender reassignment
- Sex
- Sexual Orientation
- Race
- Religion
- Marriage or Partnership
- Age
- Disability
- Pregnancy and maternity
What part of the Building Regs links to inclusive environments?
Inclusive Design
- Building Regulations: Approved Document M: Access to and use of buildings, 2015
What does the Building Regulations: Approved Document M: Access to and use of buildings, 2015 cover?
Inclusive Design Standards
Under the Equality Act 2010 what are the 4 types of discrimination?
- Direct
- Indirect
- Harassment
- Victimisation
