Chloe Hawkes, a specialist in shared ownership conveyancing, takes a look at what a RICS valuation is and why it is needed when buying or selling shared ownership properties.
RICS stands for the Royal Institute of Chartered Surveyors. A RICS valuation is an assessment carried out by a chartered surveyor who will determine the value of a property. RICS set out guidelines which must be followed by chartered surveyors which allows them to provide sellers and prospective buyers accurate estimates regarding the value of a property, before proceeding with a property transaction.
In the majority of Shared Ownership Leases, there is a requirement for a RICS valuation to be carried out, by the leaseholder when they look to sell the property. The RICS valuation allows the landlord or housing association to determine the price for the full market value of the property, in order to then understand the value pertaining to the share owned by the leaseholder. If your lease contains this provision, it is worth noting that you are unable to accept a higher offer for the property and it must be sold at the value stipulated within the valuation.
A RICS valuation is valid for a period of three months. However, if the valuation expires prior to the transaction completing, the housing association may confirm they are happy to rely on the previous survey that was carried out. Some housing associations may not be happy with this and require an extension or new survey to be conducted, of which is valid until the day of completion.
If there are concerns over the figures in the RICS valuation that has been carried out, the buyer should speak with their lender. If the lender has concerns, they may look to contact RICS. It is then for RICS to consider whether or not the RICS requirements have been followed and if the valuation provided is correct.
Unfortunately, as legal advisors, we are unable to make any comment as to the value of the property in question. In order to obtain an accurate valuation, the assessment must be conducted by a chartered surveyor who is a member of the Royal Institute of Chartered Surveyors.
If you are considering embarking on a shared ownership property transaction, Holmes & Hills shared ownership solicitors can offer advice and guidance on buying, selling, staircasing and lease extensions, including offering a free, no obligation shared ownership conveyancing quote.
Call us on 01206 593933 today to get specialist shared ownership conveyancing advice.
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