Value the valuer’s work, say groups, as backlog cases hit RM15bil
PETALING JAYA: Despite the record number of new Covid-19 cases, research analysts are positive about the broad economic recovery for the second half of 2021.
UOB said the market has already “priced in the political instability” and that the Covid-19 vaccination programme “takes precedence” over politics.
AmBank Research is also positive about the banking sector. The positive call for the sector is significant because in the event of an economic fallout, banks would be the first to take the brunt of things.
Against this backdrop, the purchase of properties – a big-ticket item – may see a rise, and it will need valuers to prepare valuation reports for financing purposes by buyers and investors.
Already, they have not been going for site inspections since June 1 and are now seeking the government’s approval to travel for site inspections.
They say site visits are crucial in the preparation of valuation reports for lending and financing purposes.
Michael Kong, president of the Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector, Malaysia (PEPS), said that as a result of a two-month ban on site visits, the backlog of reports that valuers need to prepare is stacking up.
Kong said this is particularly worrying because the vaccination programme is under way and certain economic sectors are gradually reopening.
He said there are about 300 firms involved in valuation work in the country.
“Some of them are big but, for simplicity’s sake, let us assume they are all small- and medium-scale enterprises with an average of 100 cases outstanding since June 1. That means 30,000 cases.
“If we value each conservatively at RM500,000, that is RM15 billion worth of backlog cases waiting for full valuation reports to be handed in for loans to be approved and disbursed,” he said.
He said this has held up a whole line of financing at the banks.
Kong said the figures are conservative as the larger firms would have more than 200 valuation cases stuck since June 1.
City Valuers director CY Lim said the bigger firms easily have more than 200 cases to be submitted and with the gradual reopening in the second half, he foresees a tight bottleneck.
Lim said valuation reports are needed for mortgage purposes, for the purchase of plant and machinery, factories and palm oil mills.
Valuers are asking the government to allow at least 20% of their valuation staff to travel for site inspection.
He said that site inspection visits involve one person who goes to a site, gains access to a house or a factory, or to view some machinery.
“An experienced valuer can do a house inspection in less than 10 minutes,” he said.
Private valuers come under the Board of Valuers, Appraisers, Estate Agents and Property Managers (BOVAEP), which is under the purview of the finance ministry. BOVAEP did not respond when contacted.
The plea for some leeway comes about a month after a joint statement on June 28 by six professional bodies seeking the ministry to allow them to return to their normal work routine.
The six are PEPS, the Royal Institution of Surveyors Malaysia, the Malaysian Institute of Property & Facility Managers, the Malaysian Institute of Professional Estate Agents & Consultants, the Business Valuers Association of Malaysia and Persatuan Perunding Hartanah Muslim Malaysia (PEHAM).
They have a collective membership of 15,000.
International real estate federation FIABCI Malaysian Chapter president Koe Peng Kang said FIABCI is reviewing the economic situation and will be writing to a couple of government ministries to urge them to open up further the economy.
“The valuer performs an important and essential function. Otherwise, the loan applications and other business processes which need valuation of some form or other will be stuck.
“As it is, cash flow is already a problem. Valuation services need to open up in August, if not fully than at least partially,” Koe said. - FMT
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