“From what I see, RICS (Royal Institution of Chartered Surveyors) is a handsome man, and CVEA is a pretty girl, so why not we get married?” asked a rhetorical Kim Heang.
Heang, president of the Cambodian Valuers and Estate Agents Association (CVEA), was one of the speakers at a panel discussion held on Tuesday to address the gaps in property valuation within the Kingdom, with the spotlight being on Phnom Penh.
The event’s speakers also included real estate experts ASEAN manager Salim Aslam of the Royal Institution of Chartered Surveyors (RICS), and Ross Wheble, country manager of Knight Frank.
The main issues in discussion were the country’s lack of educational initiatives to push for real estate degree courses and accreditations, real estate professionals who do not necessarily advocate ethical practices, and the importance of professional indemnity insurance for valuers to limit liability.
“We have a big dream; we want to bring the real estate industry here to a bigger level by [undertaking] training from world-class organisations – RICS,” Heang said.
To get to this stage, the CVEA will be signing a MoU with RICS in the near future, although talks are ongoing and no specific date has been stipulated.
RICS, a global accreditation firm from the United Kingdom, mandates and encourages ethical practices and standards, objectivity and transparency among land, property and construction sectors’ professionals.
“The less transparent you are, the less ethical the practice, the higher the risk. The higher the risk, the lower the value of assets, the lower the value of wealth,” RICS’ Aslam said.
David Marshall, moderator of the panel discussion, who is also head of financial institutions at ANZ Royal, turned the discussions towards tools that are available to protect valuers’ businesses.
While Aslam emphasised how vital a professional indemnity insurance (PII) is for a valuer in terms of reducing risks and potential court matters, calling valuation an art, and that “no valuer practises without PII as it’s too risky”, Heang thought otherwise: “Insurance is just insurance, banks just feel safer when they know you have insurance and will give you a loan, but I’m not very sure if they understand what the PII is.”
However, Heang said that more and more CVEA members are acquiring PII, although more of as a requirement from banks.
Marshall also noted that “one of the pitfalls that I’ve seen in Cambodia is that there could be potentially some collusion among valuers in accessing the value of the property, thus inflating the value, and then banks have to lend more money on that.”
Other prominent obstacles in establishing ethical valuation practices in the Kingdom include the skills gap as well as the weak education infrastructure, according to Knight Frank’s Wheble.
“There are no real estate-related degrees or qualifications here, so that’s an issue in terms of valuing in accordance to international levels of standards,” he said, adding that there needs to be more support of real estate courses in universities in the country.
“What we need to promote is real estate as a long-term professional career that will create demand for the real estate courses.”
Sovannaroth Khan, head of valuation at Independent Property Services Cambodia, told Post Property that the valuation practices here largely vary. “Most valuers practise according to their experience and individual research, without proper training.”
Khan believes that CVEA needs to educate all its members on the importance of being professional realtors and valuers before collaborating with international firms like RICS.
Bodies like CVEA have to play a huge part in harmonising the gap and bringing the local valuers and practitioners to adopt a standard, according to Aslam.
Aslam said, “In an up and coming country such as Cambodia, having enough professionals learned [in] international best practice would be one of the challenges.”
However, he admitted it would take time to educate young professionals with the proper skills, and aligning local practice to internationally recognised professional standards.
“Without such capacity-building efforts, there will not be enough professionals available to meet urgent demand.”