What is a Red Book Valuation?
A Red Book Valuation is one that is undertaken in accordance with the guidance as detailed by the Royal Institute of Chartered Surveyors, also known as the RICS. A Red Book Valuation has to be undertaken by a member of the Royal Institute of Chartered Surveyors who is also a Registered Valuer. The intention of a Red Book Valuation is to provide an industry standard approach to commercial property valuations ensuring the methodology and details contained in the valuation are robust. The standards and guidance set out by the RICS which are required to be followed by valuation surveyors when undertaking Red Book Valuations are updated/revised every few years to ensure they align with policy and current standards.
By instructing a Red Book Valuation a client will ensure that the appointed valuation surveyor will provide a balanced/impartial valuation which is thoroughly researched and drafted in accordance with industry standards. Every RICS company which undertakes Red Book Valuations is required to report the number of Red Book Valuations it undertakes at the end of every year. Owing to the robust nature of a Red Book Valuation a client can wholly rely upon the report.
A Red Book Valuation is often required by institutional lenders including banks and mortgage lenders when looking to lend in relation to a property acquisition. They are also required to assist with legal proceedings and for tax calculation purposes. A Red Book Valuation differs from a market appraisal which can be provided to give an informal guide to the market value, although it cannot be relied upon to the extent to which a Red Book Valuation can be.
