A property valuation isn't just a number. It's a professional opinion, backed by market analysis, physical inspection and professional liability — and the type of valuation you need depends entirely on what you're using it for. Over the years, I've carried out valuations for purchase, probate, Capital Gains Tax, matrimonial proceedings, shared ownership staircasing and lease extension purposes. Each has its own methodology and its own evidential requirements.
This guide explains the main types of RICS property valuation, when each is appropriate, and what the process involves.
What Is an RICS Red Book Valuation?
When surveyors refer to an "RICS Red Book valuation," they mean a valuation prepared in accordance with the RICS Valuation – Global Standards (commonly known as the "Red Book"). These standards define the basis of value to be used, the methodology to be applied, and the format of the report. A Red Book valuation is accepted by UK courts, HMRC, mortgage lenders and legal proceedings as authoritative professional evidence of a property's value.
Not all property valuations are Red Book compliant. An estate agent's appraisal, for example, is not — it's a market opinion rather than a regulated professional valuation. If you need a valuation for legal, tax or lending purposes, always insist on an RICS Red Book valuation prepared by a RICS-regulated surveyor.
Types of Property Valuation
1. Purchase / Market Valuation
A market valuation assesses the open market value of a property — the price at which it would sell between a willing buyer and willing seller in an arm's-length transaction. This is the type of valuation most people are familiar with. It may be required by a lender as part of a mortgage application, by a buyer to check they're not overpaying, or by a seller to set an appropriate asking price.
Market valuations take into account comparable sales in the area, the physical condition of the property, tenure (freehold or leasehold), location, local market conditions and any specific features of the property that add or detract from value.
2. Probate Valuation
A probate valuation is required when someone dies and their estate includes property. The valuation is needed to calculate Inheritance Tax (IHT) on the estate and to enable the administrators to distribute assets. HMRC requires that probate valuations reflect the open market value at the date of death.
Probate valuations are often time-sensitive — estates need to be dealt with efficiently, and delays in obtaining a valuation can hold up the entire process. At Paddington Surveyors, we prioritise probate instructions and aim to deliver valuations within 5–7 working days of inspection. Our reports are accepted by HMRC without challenge in the vast majority of cases.
3. Capital Gains Tax Valuation
If you sell a property that is not your primary residence and it has increased in value since you acquired it, you may be liable for Capital Gains Tax (CGT) on the gain. You'll need a valuation at the date of acquisition (or at 31 March 1982 if the property was held before that date) to establish your base cost. HMRC accepts RICS valuations as the evidential basis for CGT calculations.
4. Matrimonial / Divorce Valuation
When a marriage or civil partnership breaks down and shared property needs to be divided, the court or the parties themselves need an independent, impartial valuation. Matrimonial valuations can be contentious — if the parties cannot agree on the value, each may instruct their own valuer and the court will determine the matter. At Paddington Surveyors, our matrimonial valuations are prepared to withstand scrutiny in the Family Court and we have experience giving evidence in contested hearings.
5. Lease Extension Valuation
Leaseholders exercising their statutory right to extend a lease (under the Leasehold Reform, Housing and Urban Development Act 1993) are entitled to a 90-year extension at a peppercorn ground rent, but must pay a premium to the freeholder. The amount of that premium is calculated by reference to the property's value, the existing lease length and the ground rent. Both parties typically commission their own RICS valuations and negotiate from those figures.
Lease extension valuations require specialist knowledge — the calculation involves applying actuarial tables and applying enfranchisement case law to establish the "relativity" between the property's value with and without the benefit of the new lease. This is a highly specialist area and one our valuers handle regularly for properties across central London.
6. Shared Ownership / Help to Buy Valuation
Shared ownership purchasers wishing to staircase (buy additional shares) or sell their property require an RICS valuation to determine the current market value, which forms the basis for calculating the cost of additional shares or the sale price. These valuations must be carried out by an RICS-registered valuer and are typically required every 3 months.
How a Property Valuation Works in Practice
The valuation process begins with a physical inspection of the property. The surveyor assesses the property's size, condition, specification, aspect and any special features, and identifies any factors that might affect value (such as structural defects identified in a building survey).
The surveyor then analyses comparable sales — transactions of similar properties in the same area that have completed within a relevant timeframe. The weight given to comparables depends on their proximity and similarity to the subject property.
The resulting valuation report will include the surveyor's opinion of value, the basis of valuation, the key assumptions made, and the evidence considered. A Red Book compliant report will also include a declaration of the surveyor's independence and a description of the extent of their inspection.
For valuation services, see our RICS valuation services page.