Since the financial crisis in late 2007, the residential valuation profession has seen an alarming decline in the number of chartered surveyors remaining within the industry. Best estimates are that between 2008 and 2013 the industry saw a 50% reduction in capacity and a corresponding halt on trainee recruitment.
This mirrored the ‘cliff fall’ in mortgage lending over the same period which fell from £357bn in 2006 to a low of £134bn in 2010. While lending had partially picked up again to £178bn by 2013, the initial shock was enough to cause the well-publicised surveyor supply shortage.
Since 2013, there has been some repatriation of previously displaced surveyors and limited recruitment of trainee RICS associates (AssocRICs). But we have once again returned to the revolving door of in-demand experienced surveyors moving from one business to another – driving up salaries and other employment benefits. This is not unusual in post-recession booms, but this time it has been exacerbated by the severe lack of new recruits in the last 10 years, and a significantly aging workforce of remaining surveyors.
The valuation profession needs new trainee surveyors and plenty of them. The likelihood is that most, if not all, will be ‘tech savvy’ people who are capable of picking up and running with the current data collection tablet technology and software solutions designed to streamline survey and valuation processes, improve quality and reduce risk and fraud. In fact many of the recent graduate trainees are surprised at the limited ability of the industry technology and operating systems.
The primary challenge to recruitment in the valuation sector is that there is no short-term solution. Replenishing the residential surveyor talent pool will take a concerted effort from the major corporate surveying business over a five to seven year period to make any noticeable impact. The Council of Mortgage Lenders is projecting gross mortgage lending to increase from £220bn in 2015 to £261bn in 2017 and somewhere north of £280bn in 2019.
The actual solution lies in a combination of ongoing trainee recruitment over the next three to five years, plus more creative use of valuation software database tools. Many automated valuation models (AVMs) have lain dormant in lender systems since 2006. But over the last couple of years a number of these have been re-commissioned and brought back into use; with a couple of the larger UK lenders using AVMs to originate purchase lending as opposed to remortgage, where AVMs were previously heavily utilised.
A number of the industry suppliers are now offering risk models which utilise existing AVM data sets, merging these with other socio-economic data sets, to produce an AVRM capable of delivering risk data to surveyors tablet PCs. This facilitates more successful desktop valuation – thereby reducing the volume of properties requiring an external inspection and easing already stretched capacity.
In short, the valuation industry needs to attract flexible and adaptable ‘tech savvy’ trainees capable of interpreting and analysing risk data. At the same time they must be capable of, and experienced in, inspecting and valuing higher risk properties falling outside the automated valuation risk model. A tall order indeed.