Being aware of hot topics, whether they relate to market issues, RICS guidance or legislation, is essential to provide the highest standard of professional advice to clients. It also demonstrates your competence across your chosen APC competencies, while adding to your CPD through private study, for example. While this list is not definitive, here are six of the current hot topics. For others, make sure you check out the further reading and resources.
1. Government residential leasehold reform
In July 2020, the Law Commission published three reports relating to residential long leasehold reform. The aim was to promote fairness and security in leasehold home ownership in England and Wales. Current issues relate to the costs of extending a residential long lease, combined with expensive escalating ground rents, which can cause problems when leasehold properties are bought or sold.
In January, Robert Jenrick announced the following:
- a new legal right for leaseholders of flats and houses to extend leases by 990 years at zero ground rent;
- the payment of marriage value from the premium calculation will be abolished and set calculation rates will be established;
- leaseholders will be able to voluntarily agree a restriction on future development to avoid paying “development value”; and
- grounds rents for all new retirement properties will also be set at zero.
Furthermore, a Commonhold Council, including various leasehold groups, industry bodies and government, will be created to prepare the market for anticipated increased use of commonhold tenure, with further announcements expected in due course.
A two-stage process is proposed for legislating the changes. Stage one is to introduce legislation through the next session of parliament in relation to ground rents. Stage two will relate to the remainder of the recommendations of the Law Commission.
As well as being of personal interest to many RICS APC candidates, this is essential knowledge for residential and valuation candidates, as well as any commercial property candidates advising on mixed-use property.
2. Independent review of real estate investment valuations
RICS has launched its independent review of real estate investment valuations. It is looking at how assets are valued for investment purposes, specifically:
- valuation methodology;
- property risk analysis, also known as the “forward look”;
- independence and objectivity; and
- measuring market confidence in RICS valuer performance.
Feedback on the Call for Evidence is invited by 31 March 2021. This will form part of the evidence reviewed by the expert advisory group, which will publish its findings by September 2021.
Being aware of the review and its potential implications for the industry is essential knowledge for candidates pursuing the valuation competency.
3. RICS Covid-19 recovery business plan 2020-2021
In response to the Covid-19 pandemic, RICS has published its Recovery Business Plan 2020-21.
This sets out the strategic direction and objectives of RICS in response to Covid-19 and other market challenges over a three-year period. The 12 months are given particular focus, with the aim of creating a “new, more resilient RICS, fit for the future and capable of responding rapidly to ongoing and significant socio-economic changes and trends that impact our profession”.
Key priorities include:
- to be an influential thought leader, trusted by key stakeholders;
- to be a sustainable 21st century professional body;
- to enhance RICS’ environmental, social and governance programme; and
- to grow a high-performance culture.
This is a hot topic for the business planning competency, as well as generally being aware of RICS and how its strategic direction reflects the current climate.
4. Changes to RICS governance structure
2020 saw changes to the structure of governance at RICS to introduce “more diverse and global expertise, alongside increased independent-led oversight of our standards and their enforcement”.
A new governing council was elected, with professionals from 12 global regions and six strategic areas of the profession. The current (interim) chair is Chris Brooke FRICS.
Furthermore, a new Standards and Regulation Board has been established, with the chair and majority of members being independent from the profession. The role of the board is to “provide assurance across all RICS standards and how they are enforced globally”.
This is a relevant hot topic for the ethics, conduct rules and professionalism competency.
5. Planning white paper
The planning white paper was published on 6 August 2020, proposing radical reform to the current planning system with the aim of making it fit for purpose. This involves ensuring that the right land is available in the right places and for the right form of development. Five of the key proposals are:
- Zoning introduced in local plans, categorised into growth, renewal and protected areas.
- Standard method introduced for establishing housing requirement figures, which would factor in land constraints and opportunities.
- Growth zoned areas automatically granted outlined planning permission for the principle of development.
- Section 106 agreements no longer used and the community infrastructure levy being altered.
- Local design codes produced by local authorities to improve design quality and placemaking.
Being aware of the white paper is essential knowledge for planning and development candidates, as well as candidates on other pathways pursuing one of the planning-related competencies.
6. IPMS All Building Asset Classes consultation
IPMS and RICS have launched a consultation on the proposed International Property Measurement Standards: All Building Asset Classes. The consultation closes on 31 March 2021.
The new IPMS standard will relate to the measurement of mixed-use and specialist buildings. The proposed new IPMS bases are:
- IPMS 1: floor area measured to the external extent of the external walls and to any external floor areas, sheltered areas and notional boundaries.
- IPMS 2: floor area measured to the internal extent of the internal dominant face and any notional boundaries and external floor areas.
- IPMS 3A: the floor area available on an exclusive basis to an occupier measured externally and including any external floor areas, sheltered areas and secondary areas.
- IPMS 3B: the floor area available on an exclusive basis to an occupier measured internally to the IDF and any demising walls and notional boundaries.
- IPMS 4A: The selected floor area in a building measured to finished surfaces and any notional boundaries including all floor area occupied by walls and columns.
- IPMS 4B: the selected floor area in a building measured to finished surfaces and any notional boundaries excluding (subtracting) all floor area occupied by walls and columns.
Top assessor tips
- Assessors want to know that a candidate is a safe pair of hands – give that perception from the outset by what you wear, what your room looks like and how you present yourself on camera.
- Don’t let yourself down by not being prepared for your final assessment interview.
- Check your equipment works and if you need new gear, for example a webcam, buy it in advance and ensure that you have time to test that it works properly.
Top candidate tips
- Give your submission to a non-surveyor to proofread. They often pick up issues that you might not have noticed.
- Be aware of hot topics, particularly how they may affect your actions or advice.
- Podcasts are a great way to keep abreast of the market, why not grab some fresh air and listen to one on a walk?
The quick quiz (answers at the bottom)
1. Which IPMS standards are already adopted by RICS?
- Residential
- Offices
- Retail
- Industrial
- Leisure
2. Which IPMS standards have been published by IPMS but not yet adopted by RICS?
- Residential
- Offices
- Retail
- Industrial
- Leisure
3. In what year did RICS acquire the word “Royal” in its title?
- 1946
- 1958
- 1883
Further reading and resources
- Law Commission report Leasehold home ownership
- RICS Independent Review of Real Estate Investment Valuations
- RICS Covid-19 Recovery Business Plan 2020-2021
- IPMS All Building Asset Classes consultation
Answers: 1: Residential and offices; 2: Retail and industrial; 3: 1946
Jen Lemen FRICS is a co-founder of Property Elite, a chartered surveyor, a registered valuer and an APC assessor
