The Royal Institution of Chartered Surveyors has appointed Dr Oonagh McDonald as chair of an independent commission into the property valuation sector after it was revealed borrowers are being hit with huge waiting times for valuations.
The commission will call for written evidence by 30 September and oral evidence by October from the insurance sector, lenders, valuers and their clients, legal professionals, consumers and regulators.
It will look at the availability of valuers in the market willing and able to undertake valuations, the level of fee transparency and what effect low fees are having on valuation standards, and the challenges of the availability and pricing of professional indemnity insurance.
RICS will publish a report with its findings in November, in which it hopes to address the issue of recent valuation delays.
McDonald, a former MP and FSA board member, says: “I am delighted to be appointed chair of this independent commission which will consider the market challenges facing the valuation sector in the UK.”
In June Money Marketing’s sister title Mortgage Strategy mystery shopped three of the UK’s biggest valuation firms to investigate complaints from brokers who were experiencing major delays instructing valuers in London.
Posing as a borrower, Mortgage Strategy contacted three surveyors – Colleys, e.surv and Connells – to ask how long it would take to get a homebuyer report and, separately, a less detailed valuation done on a property in SW15, with a mortgage from Halifax.
Connells and e.surv revealed that they were currently “on hold” in SW15, meaning they were not accepting new instructions. A customer service representative for Colleys revealed that it was booked up until the first week of July and then its surveyor was off for two weeks, so it was not available until the 22 July.
In the main brokers blamed the delays on a lack of valuers. But Rics hit back and argued there were enough valuers but because lenders were “squeezing” fees valuers were turning down unprofitable work. The body also blamed high PII premiums as a result of “unsubstantiated” negligence claims from lenders.
In terms of valuer numbers there are currently 8,500 residential valuers registered, of which 5,500 list residential valuation as their primary activity, and around 2,000 of which work for the largest 20 firms in the UK.
Mortgage Strategy subsequently revealed RICS planned to launch an independent commission to determine the cause of the delays.
John Charcol senior technical manager Ray Boulger says: “The quickest way to solving the problem of delays is for lenders to pay them more.”