The organisation says that after rigorous discussions, industry experts decided that public sector valuations of investment properties, whether undertaken internally or by an external valuation firm, are distinct from valuations of investment property counterparts in the private sector in terms of both actual risk and public perception.
The valuations for which rotation is mandatory are known as regulated purpose valuations (RPV). The purposes covered are fully detailed at UK VPS 3. RICS’ UK rotation policy is included at UK VPS 3.3.
The RICS Valuation Review in 2020 recommended that ‘RICS should develop a time specific, mandatory procurement and rotation process for valuers’. Following this, the RICS Valuation Review Implementation Committee (VRIC) decided in their 2023 report that this recommendation shouldn’t initially apply to public sector valuations, subject to RICS undertaking an additional work stream in this area.
The working group comprised senior public and private sector valuation professionals, public sector finance professionals, and other key stakeholders involved in the valuation process. It was chaired by Nick French, who is also chair of RICS’ Global Valuation Standards Expert Working Group.
It was agreed that the existing oversight mechanisms of other bodies, such as the government, together with the annual external audits of all valuations, for which third-party valuers are usually included in the audit teams, are robust and ensure that all investment valuations are reviewed.
This recommendation has been approved by the RICS Standards and Regulation Board, the recently established Valuation Assurance Committee and the Knowledge and Practice Committee.
The full report may be found here.
