So who is responsible for the rise in property prices over the last few years? Is Mr Inflation really to blame?
There was a time when a surveyor would come along and value a property in accordance with certain rules and criteria – ranging from the size of the property to amenities such as the size of the plot, toilet arrangements and heating.
There was a formula for calculating the value of a house. As much objectivity as possible had been built into the process. This meant that a house valuation was sacrosanct. The surveyor was in charge and his word was final.
The Royal Institution of Chartered Surveyors has now become a follower instead of a leader. How often is a property down-valued nowadays – unless it is about to fall over ? ( Of course in the present climate, the surveyors are able to flex their muscles a little bit but only if the banks let them.)
Valuations are now totally subjective and very often carried out by unqualified staff who then have the valuation “signed-off” by FRICS ( Fellow of the Royal Institute of Chartered Surveyors – they have a very good restaurant at their palatial offices in Birdcage Walk).
Inflation is not just in the extra noughts that have appeared in the last 30 years – it is in the attitude of the surveyors. It is also in the survey fee which is directly linked to the value of a property.
Unless the surveying community reasserts itself, lenders will realise that surveyors are just an unnecessary overhead.
Very soon, more unqualified twenty-somethings in Next suits and Ford Mondeos will be dispatched to “value” the property and there will be no-one to apply the brakes.