Withdrawal of global COVID-19 valuation practice alert

There has been a maturity of the COVID-19 situation globally and in many areas government restrictions and regulatory protocols have or are currently being lifted.

Following engagement with stakeholders, the global COVID-19 valuation practice alert last updated July 2021 is to be withdrawn today. This also includes the following:

• Withdrawal of the COVID-19 market conditions explanatory note
• Withdrawal of general valuation practice and process recommendations related to COVID-19
  
• Withdrawal of suggested material uncertainty wording related to COVID-19. In the limited circumstances where material uncertainty is still being declared, it should be reported to reflect the individual circumstances
  
• Archiving of the Impact of COVID-19 on valuation- Supplement to the RICS Practice Alert. It will have ‘no longer current’ status but will remain available here for information purposes.
  

The effects, and aftermath of the COVID-19 health crisis may still impact the work carried out by RICS regulated members, which will vary globally and across different markets. Valuers are reminded to follow the latest Global Red Book standards and any other standards and guidance related to the work being undertaken.

COVID-19 was declared as a “Global Pandemic” by the World Health Organisation in March 2020. Further “waves” of the pandemic escalated and dissipated at different times and degrees of severity. Much has been learnt about the way the crisis has affected markets since the unprecedented and unknown initial impacts. It is essential valuers follow government advice, regulation, and market practice relevant to their jurisdiction. Many governments and markets globally have now eased restrictions and protocols relating to COVID-19 and valuers should be aware of the current circumstances relevant to their work.  

Market conditions

Individual markets may react differently to COVID-19 and its aftermath. Commentary upon market conditions should reflect the individual valuation and market circumstances.

Material valuation uncertainty

Available valuation evidence in many markets globally has improved substantially since the initial impact of COVID-19 in 2020. In very limited cases, material valuation uncertainty related to COVID-19 may remain.

RICS regulated members will consider the circumstances in which a material uncertainty declaration is appropriate. RICS regulated members should be fully aware of VPGA 10 and VPS 3 within RICS Global Red Book in the decision-making process. It’s worth noting that VPGA 10 refers to ‘relatively unique’ market factors and, for example, ‘an unprecedented set of circumstances on which to base a judgment’. This may be of note when considering the current impact of COVID-19 or its aftermath, compared to the initial outbreak.

Whether material uncertainty exists remains the decision of the RICS regulated member. They should include a sound rationale to explain the decision-making process, and this should be recorded for future reference.

Where material uncertainty is declared, the valuer is reminded that this should be explicitly stated. Where appropriate, the valuer may also want to reference the terms and output of the RICS Material Valuation Uncertainty Leaders Forum (UK), or another forum relevant to their jurisdiction.

If you have any queries related to the withdrawal of the COVID-19 practice note please contact standards@rics.org or engage with the myRICS Community.