RICS Core Material, Legislation, CBRE Documents Flashcards
Real Estate Agency and Brokerage 2016
Global Professional Standard - outlines the principles of fairness and transparency that underpin work undertaken by real estate agents
12 mandatory principles:
1. Be fair, transparent, professional
2. Due skill, care and diligence,
3. Clear ToE
4. Avoid conflicts of interest. Deal with them properly if they arise.
5. Don’t discriminate
6. Communicate fairly, clear, timely and transparent.
7. Ensure marketing material is honest, decent and truthful.
8. Client money held separate in designated accounts and insured.
9. Adequate PII
10. Ensure clear scope
11. If required, give realistic price using best judgement.
12. Ensure meetings, inspections and viewings are carried out in accordance with client’s lawful wishes with regard for health and safety.
8 best practice sections on:
1. Ethics
2. Securing instructions
3. Acting for seller: Marketing the property
4. Acting for seller: Agreeing the sale or lease
5. Acting for buyer
6. Ending the instruction
7. Safety and security
8. Agency management
Code for Leasing Business Premises, 2020
Professional standard (mandatory).
Objective is to improve quality and fairness of negotiations on lease terms and to promote comprehensive HOTs to make legal process more efficient.
Mandatory requirements:
o 1.1 – Negotiations over the lease must be approached in a constructive and collaborative manner
o 1.2 – A party that is not represented by an RICS member or other property professional must be advised by the other party or its agents about the existence of this Code and its supplemental guide and must be recommended to obtain professional advice.
o 1.3 – The agreement as to the terms of the lease on a vacant possession letting must be recorded in written heads of terms, stating that it is ‘subject to contract’ and summarizing, as a minimum, the position on each of the following aspects:
Identity and extent of the premises (and requiring the landlord to arrange the provision of a land Registry-compliant plan if the lease is registrable)
Any special rights to be grated, such as parking or telecom/data access
Length of term and whether the Landlord and Tenant Act 1954 will apply or be excluded
Any options for renewal or break rights
Any requirements for a guarantor and/or rent deposit
The amount of rent, frequency of payment and whether exclusive of business rates
Whether the landlord intends to charge VAT on the rent
Any rent-free period or other incentive
Any rent reviews including frequency and basis of review
Liability to pay service charge and/or insurance premiums
Rights to assign, sublet, charge or share the premises
Repairing obligations
Initial permitted use and whether any changes of use will be allowed
Rights to make alterations and any particular reinstatement obligations
Any initial alterations or fit-out (if known), and
Any conditions of letting, such as subject to surveys, board approvals, planning permission.
What is the key legislation in relating to leasing and letting?
Misrepresentation Act, 1967
Mis-tatements/false/fraudulent statements or misrepresentations made during the pre-contractual enquiries by the vendor or their agent to the proposed purchasers.
Offence:
- Civil offence.
- Actionable by tort.
- Action can be limited by an effective disclaimer (exclusion) clause
Penalties:
Sued for financial damages and or/contract rescinded
- Estate Agents Act, 1979
During the sale or purchase of freehold or leasehold properties with a capital value. - S.18 – Terms of business
- S.21 – Declaration of personal interests
Offence:
- Acting dishonestly
- Not providing clarity to the terms of engagement or disclosing a personal interest.
- Not telling the client about offers received.
Penalties:
Warning order or prohibition order and/or fine
Consumer Protection Regulations, 2008
- During the entire agency sales and lettings process
Offence:
- Criminal offence
- Not treating ‘customers’ fairly and/or providing misleading marketing information
Penalties:
Unlimited fine, prohibition order and prison up to 2 years.
What other legislations are relevant to leasing and letting?
- Bribery Act, 2010
- General Data Protection Regulation, 2016 & Data Protection Act 2018
- Equality Act, 2010
- Energy Act, 2011
- Health and Safety Act 1974, as amended
- Proceeds of Crime Act, 2002
- Money Laundering, Terrorist Financing and Transfer of Funds (information on the payer) Regulations 2017 (as amended
- Town & Planning (Control of Advertisement) (England) Regulations, 2007 as amended.
What are the materials relating to measuring?
Code of Measuring Practice, 2015
* Best practice document for all measurement exercises except for office and residential properties.
IPMS: Office Buildings (2014)
IPMS: Residential Buildings (2018)
IPMS: All Buildings (2023) (NB - Not currently incorporated into RICS Guidance
RICS Professional Standard: RICS Property Measurement (2nd edn.) January 2018
* The guidance provides an understanding of the application of the professional standard and technical definitions. It also incorporates aspects of the IMPS suite of guidance.
* At the date of categorization, the following statement was added in bold text to the guidance and to RICS.org:
o Following the publication of IMPS: All Buildings, please note this document is in the process of being updated. Please see the RICS website for further updates.
UK commercial Real Estate Agency, 2016
Professional Statement that outlines the principles that shape the culture of fairness and transparency that underpin all activities undertaken by real estate agents within whichever country of practice.
What RICS document provides advice on market appraisal in commercial property?
Professional Statement: UK commercial Real Estate Agency, 2016
Provides advice on advising a price or rent for marketing purposes, providing market advice, reporting advice to the client, and keeping records.
What is the key piece of RICS material in relation to Strategic Real Estate Consultancy?
Reissued as a professional standard in May 2023 - Sustainability and ESG in Commercial Property Valuation and Strategic Advice, 2021.
Provides practically and globally relevant principles for the delivery of the sustainability and ESG requirements in the Red Book.
Provides:
- Good practice advice supporting everyday commercial valuation practice and its interface with ESG and sustainability.
- Alignment of ESG and sustainability considerations with the core mechanics of valuation (purpose, basis, approach).
- A glossary of globally relevant sustainability and ESG terms and an appendix referencing world-leading rating, benchmarking and performance frameworks and tools.
What is the key legislation in relation to data management and what are the key takeaways?
UK General Data Protection Regulation and the Data Protection Act 2018.
Key requirements:
- Obligation to conduct data protection impact assessments for high risk holding of data.
- Data controller decides how and why personal data is processed and is directly responsible for GDPR.
- ‘Data accountability’ ensuring that organizations can prove to the ICO how they comply with regulations.
- Data security breaches need to be reported to ICO in 72 hours.
Fines of up to 4% global turnover or £17.5m (whichever is greater).
Principles:
Article 5(1) - data must be:
- Processed lawfully, fairly and in a transparent manner in relation to individuals.
- Colelcted for specified, explicit and legitimate purposes and not further processed in a matter that is incompatitable with purposes.
- Adequate, relevant and limit to what is necessary for the purposes for which they are processed.
- Accurate and kept up to date. And every reasonable step must be taken to ensure that personal data that is in inaccurate is erased or rectified.
- Kept in a form that permits idenditifcation of data subjects forno longer than is necessary.
- Processed ina manner than ensures appropriate security of personal data.
Article 5 (2)
- The controller shall be responsible for an be able to demonstrate competence with the principles.
Tell me about the Freedom of Information Act, 2000
- Gives individuals the right to access information held by public bodies (eg companies house, land registry).
What material is provided by RICS on Rights of Light?
Professional standard - Rights to Light, 2016
- Arises after 20 years of uninterrupted enjoyment of lights without consent of 3rd party by way of easement with prescriptive right.
- If right to light infringes that injunction can be granted and damages awarded.
What is legislation in relation to Party Walls
Party Wall Act 1996 - provides framework on dealing with issues.
Party wall = if it stands astride the boundary of land belong to 2 or more landowners.
Should refer a specialist.
What are the RICS document categories?
Currently being reviewed by RICS.
Professional Standards - Set requirements or expectations for RICS members and regulated firms about how they provide services or the outcomes of their actions. Mandatory requirements which use the word ‘must’ must be complied with. Recommended best pratice sections use the word ‘should’
RICS Practice Information - Information to support the practice, knowledge and performance of RICS members and regulated firms, and the demand for professional services. This information is not mandatory and does not set requirements for RICS members or make explicit recommendations.
What RICS material is there to do with health and safety?
Surveying Safely, 2018 - professional standard. Outlines:
- responsibilities of members and corporate responsibilities of firms
- Assessing hazards and risks
- Risks around places of work
- Occupational hygiene and health
- Visiting premises or sites
- Fire safety
Is there any legislation regarding health and safety?
Health and Safety at work 1974, as amended
“Duty to every employer to ensure, so far as reasonably practicable, the health, safety and welfare at work of all employees”.
PPE at Work (Amended) Regulations, 2022
* Extends the employers’ duty to ensure provision of appropriate PPE
* Could include cleaning, security and construction workers
