FIG Commission 9 Valuation and the Management
of Real Estate
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Work Plan 2023-2026
PDF:
Original Work Plan in .pdf-format
VIDEO:
Chair of Commission 9
Peter Ache takes you through the Work Plan
Improving transparency in the real estate markets for better planning
and tackling the global challenges of a changing world.
Terms of Reference
The real estate market, and in particular the market for residential real
estate and agricultural land, is of often underestimated in their
importance. In Germany, for example, the trade in real estate corresponds to
more than 10 % of the gross domestic product. This fact is very rarely
noticed.
Real estate is also of outstanding importance in the context of climate
change. Here it is particularly important to first assess the building stock
of real estate and its quality.
However, this is only the economic and ecological significance.
Residential real estate is an essential basis for the quality of life and
the families safety in every respect. Acquiring and holding a property is
usually a lifelong project with high economic risks for families or
investors in general.
Agricultural real estate is not only a significant economic factor; it is
also the basis for the supply of the population. They are also the most
important source of income of people in rural regions of the world.
The task of FIG Commission 9 will be to work on improving transparency in
the real estate markets. Approaches are to be found at the end of the
current period:
- Clear and strong definitions of the term "transparency in the real
estate market".
- Find out what makes transparency on the real estate markets
measurable and assessable.
- Find practical examples of good or bad transparency.
- Develop approaches for fairer valuations and more comprehensive
market observation under the aspect of digitalization.
- Develop approaches for the evaluation and observation of real estate
market transparency.
Mission Statement
FIG takes the lead in the discussion on transparency in real estate
markets. The vision is that by 2026 this issue will be on top of the agendas
of organisations working globally on issues such as valuation, land
management and climate change topics and others.
General
FIG's agenda
The entire agenda of the FIG in the period 2023 to 2026 has its basis in
the idea of the need for sustainable action with the aim of leading the
climate agenda to its goal. This includes ensuring that the surveying
profession and its close relatives provide their services in a sustainable
manner. But it also means that we contribute to creating the conditions that
enable politicians, administrators, companies and institutions to make
correct and quick decisions. We want to help ensure that climate protection
measures, urbanisation, environmental and resource protection and the
challenges of technological upheaval and demographic change can be well
managed.
As professionals in the land, built and natural environments, we will
need to step up to ensure we remain relevant and demonstrate our resolve.
This means we will all need to demonstrate:
- Clarity and collaboration – a listening and action approach
- Purpose and reliability – a visible approach
- Action and courage – working together to deliver This fundamental
orientation of the FIG´s Council will also be reflected in the actions
of Commission 9 of the FIG.
Commission 9´s Agenda
Improving Transparency of the Real Estate Markets
The valuation and management of real estate has a completely different
meaning today than in the past. The world has become more interconnected,
the subject areas are considerably complex. One of the important fundamental
pillars of democracy and fair action is transparency in decision-making and
action. In the age of inconceivably large amounts of data being created
every day, there is a balancing act between the demand for the free use of
data, the quality of data analyses and - above all - the independence of the
use of the data. At the same time, however, data must not be used for
personal monitoring of people or even restrict freedom. This also applies to
the real estate market.
In this context, many questions arise:
- Is transparency only the availability of data or is transparency
also the quality of the insights and reports generated from the data?
- How available are purchase prices of real estate and do they have
the quality to infer the value of other properties from the sample of
known prices?
- How important are links from land-registration-systems and prices of
land and real estate objects?
- How available are reports and what are the main evaluation issues in
expert reports and opinions?
- What are good valuations and good reports and are they more
theoretical or based on empirical data?
These are the questions we want to address. And we want to create a
better link to Geodesy:
- Why, for example, are real estate price data not also Geodata in the
sense of the INSPIRE guidelines and what opportunities would exist if
they were?
- Can a link be made between real estate prices and digital twins in
cities and what is the connection to Building Information Modelling?
- What solutions can valuation and market monitoring contribute to
improving the availability of affordable housing, compensation for
expropriations or fair taxation?
These questions also have their foundations in the principles of
transparency in the real estate market. But there are also two other
questions:
- Where, for example, are the interests in non-transparency?
- Who benefits from non-transparency and who has disadvantages?
We believe that transparent real estate markets are an important
component and can better address the challenges of today´s society an help
for a better managing all the virulent changes all over the world. This
explicitly includes the United Nations' SDGs (Sustainable Development
Goals).
We first want to pick up three main points:
- How do we get housing that is appropriate and affordable for people?
- How do we bring the challenges of climate change into the real
estate market and what do we need to know to measure price effects?
- What indicators are we able to find for verifying the success (or
failure) of political action in housing- and land-decisions.
Procedure and collaboration
Within the FIG there is very extensive knowledge and great experience
from colleagues around the world. The surveying profession is characterised
by practical and scientific knowledge in all matters related to the earth,
its vegetation, its cultivation and the life associated with it. Surveying
the earth is not just technical surveying, it is also understanding what is
going on. That is why it is important to tie the threads of knowledge of
colleagues together. The term "improving transparency" is an overarching
concept that needs to be filled with life.
We want to achieve our goals by:
- Dialogs and Discourses on an international level
using today's communication channels. The focus is on the process of
opinion-forming, which should culminate in the publication of the FIG´s
position.
- Respectful interaction and cooperation on the base
of the general FIG´s agenda and the special challenges of the tasks of
the Commission 9. At the same time, we are aware that the work we all
put in, is essentially voluntary.
- Addressing the objectives in a way that is oriented towards the
matter at hand, without taking into account special economic interests
of states, companies or organisations.
Commission 9´s Agenda on Sustainable Development Goals (SDG)
of United Nations
On 25 September 2015, the 17 Sustainable Development Goals (SDGs) were
adopted at the United Nations General Assembly in New York. This "2030
Agenda for Sustainable Development" contains 17 goals including an
indicator-based monitoring system to measure the quality of implementation
of the sustainability goals (https://www.sdgs.un.org/2030agenda).
The overall objective of Commission 9's work is to work towards improved
transparency in the land markets. Real estate has an outstanding importance
of the quality of living and working, the transparency of this market is of
particular importance. Corruption, money laundering and white-collar crime
are the more difficult the more transparent the market is. Banks reduce the
risk of lending their money as the expected performance of real estate can
be estimated more securely and current developments can be analysed more
quickly. The dangers of a financial crisis diminish when investors can
assume that property prices do not develop completely outside of a sensible
market context. In addition, governments can use the data to make funding
decisions for reducing soaring real estate prices.
SDG 13 (Climate Action) is also part of the transparency intention, because
climate neutrality cannot be achieved without climate-neutral and
sustainable construction and the related financing instruments (which in
turn also include the evaluation of the price effects of climate-neutral
buildings). We also have to look for partners for these goals within the
valuation- and the land management scene. These communities are, especially
in the Commission 9 area, most often also geographers, economists or
sociologists.
Beside the SDG 13 there are many of the SDG linking to the goal of
transparency of real estate markets. In general, it can be said that real
estate and land play a role wherever people live, work, learn and spend
their leisure time. The more transparent ownership and prices are, the
better the SDG can be achieved. The main issues to which the tasks of
Commission 9 are closely related are:
SDG 1: No Poverty
SDG 2: No Hunger
SDG 9: Industry, Innovation, Infrastructure
SDG 11: Sustainable Cities and Communities
- 11.1: ensure access for all to
adequate, safe and affordable housing and basic services and upgrade slums.
- 11.1.1 Proportion of urban population living
in slums, informal settlements or inadequate housing.
- 11.3 By 2030, enhance inclusive
and sustainable urbanization and capacity for participatory, integrated and
sustainable human settlement planning and management in all countries.
- 11.3.1 Ratio of land consumption rate to
population growth rate.
- 11.3.2 Proportion of cities with a direct
participation structure of civil society in urban planning and management
that operate regularly and democratically.
SDG 17: Partnerships
Working groups
Working group 9.1 - Definition of Transparency on Real
Estate Markets
Policy Issues
Foundation for fair and democratic action is the transparency of
decisions and the actions of the State and the economy to ensure the
security and trust of the people. We are not aware of any appropriate
definitions of the term "transparency on the real estate market" that are
accompanied by measurable indicators and have found their way into state
action. We believe that it is worth getting in touch with the authorities
and making suggestions.
The main objective is consistent with the goals of the UN SDGs.
- SDG 1: No Poverty
- SDG 2: No Hunger
- SDG 13: Climate Action
- SDG 17: Partnerships
Chair
Preliminary : Prof. Dr. Bastiaan Reydorn, NL
Specific project(s)
- Develop a position on the definition of transparency in the real
estate market.
- Development of an indicator system to measure the quality of
transparency in the real estate market.
- Develop a campaign to widely publicise the FIG's view on this issue.
Workshop(s)
Are certainly planned; especially beside on other FIG or similar events,
like World-Bank Conferences, FIG ACCO-Meetings, FIG Conferences
Publication(s)
First draft of a title:
"Transparency in the real estate market - a worldwide definition and
indicators for its measurement"
Timetable
- 14.02.2023: Kickoff-Meeting online
- Presence Meeting at FIG Working Week in Orlando
- Further timetable will be agreed within the working group and
depends on the process of working
- Regular online meetings of the working group and interested external
colleges
Beneficiaries
- World Bank (has already indicated an interest)
- Expert associations such as RICS, IVSC etc.
- Land management authorities and Funding institutions for the
creation of affordable housing
Working group 9.2 - Best practice Cases on
Transparent Real Estate Markets
Policy Issues
This working group follows on directly from the core topic of Com 9,
"Transparency in the real estate market". Here, colleagues are to be brought
together in whose countries there are particularly good or particularly bad
examples of transparency on the real estate market. The SDGs are just as
important as in WG 9.1.
Chair
NN.
Specific project(s)
Will be discussed at FIG Working Week 2023, and published afterwards.
Workshop(s)
Are certainly planned; especially beside on other FIG or similar events,
like World-Bank Conferences, FIG ACCO-Meetings, FIG Conferences
Publication(s)
First draft of a title:
"Transparency in the real estate market - Good examples of transparent real
estate markets, their technical and legal foundations and their advantages."
Timetable
- 14.02.2023:
Kickoff-Meeting online
- Presence Meeting at
FIG Working Week in Orlando
- Further timetable
will be agreed within the working group
Beneficiaries
- World Bank (has
already indicated an interest)
- Expert associations
such as RICS, IVSC etc.
- Land management
authorities and Funding institutions for the creation of affordable housing
Working group 9.3 - Automated
Valuation Modelling (AVM) with machine learning and artificial intelligence
Policy Issues
The topic of "artificial intelligence" is gaining special significance
based on the large amounts of data being generated daily, also about real
estate markets. This working group is intended to bring together experts who
have already dealt with the topic of "AVM" and gathered experience. In
particular, the connection between scientific knowledge and practical
experience must be brought together here.
This experience is to be structured and processed in such a way, that it can
be used both in concrete real estate valuation and in real estate market
monitoring.
The main objective is consistent with the goals of the UN SDGs.
- SDG 1: No Poverty
- SDG 2: No Hunger
- SDG 9: Industry, Innovation, Infrastructure
- SDG 11: Sustainable Cities and Communities
- SDG 13: Climate Action
- SDG 17: Partnerships
Chair
Preliminary: Steven Nystrom, NSPS (USA)
Specific project(s)
Will be discussed at FIG- Working Week 2023, and published afterwards.
Workshop(s)
The workshops and symposia to be held on this topic must aim to bring
together colleagues who have scientifically studied AVM, those who have
developed appropriate algorithms and those who have already applied this
method.
Publication(s)
First draft of a title:
"Automated Valuation Modeling: Basics, prerequisites and advantages of
automated valuation as a pillar of transparency on the real estate market"
Timetable
- 14.02.2023:
Kickoff-Meeting online
- Presence Meeting at
FIG Working Week in Orlando
- Further timetable
will be agreed within the working group
Beneficiaries
- World Bank (has
already indicated an interest)
- Expert associations
such as RICS, IVSC etc.
- Tax authorities and
other administrations
Further Working Group(s) - future Focuses
The FIG Comm. 9 provides that the process of further developing transparency
in the real estate market is an agile process. Therefore, if further
questions and issues arise in the course of the discussion on this topic,
which are not foreseeable at this early stage, further working groups (also
temporary) will be set up.
The topics could be e.g.:
- Valuation and the
use of Digital Twins/Building Information Models
- Challenges of real
estate valuation and real estate market monitoring due to climate change
- Minimum requirements
for property market price databases
- Taxonomies for
property types and categories for spatial submarkets
- Integration of
property price data into the Systematics of Geoinformation
- Further development
of the valuation of unregistered land from the last period
Co-operation with other Commissions and
organisations
The great advantage of the FIG is the broad competence of the experts
brought together here in the sector of geodesy, land development and
evaluation. For this reason, Com. 9 attaches particular importance to
cooperation with other FIG-commissions.
From the current point of view, cooperation with the following commissions
seems to be particularly useful:
- Com. 3 "Spatial
Information Management"
- Com. 7 "Cadastre and
Land Management"
- Com 8 "Spatial
Planning and Development"
- Com 10
"Construction, Economics and Management"
Co-operation with United Nation Organisations,
Sister Associations and other Partners
Commission 9 will continue its existing cooperation with the
- International
Valuation Standards Council (IVSC)
- the International
Taxation Institute (IPTI)
- the World Bank
- GLTN and UN-Habitat
Which other organisations and institutions are willing to work with the FIG
to improve transparency in the real estate markets will emerge from the
discussion process within Commission 9 and with the above institutions.
Commission Officers
Commission Chair
Peter Ache
peter.ache[at]dvw.de or FIGCommission9[at]fig.net
- Chair of the
Commission "Valutation of Real Estate" of the German DVW e. V.
- Editor-in-chief for
the real estate market report for Germany of the state expert committees in
Germany
- Head of the office
of the governmental upper committee of experts for property values in Lower
Saxony (Germany)
Vice Chair of Administration
NN.
(To be determined at a meeting of Com. 9 at the FIG- Working Week in
May/June 2023 in Orlando )
Chair of Working Group 9.1
Indicative: Bastiaan Reydorn, NL
(To be finalised at one of the next meetings of the Working Group 9.1)
Chair of Working Group 9.2
NN.
(To be finalised at one of the next meetings of the Working Group 9.2)
Chair of Working Group 9.3
Preliminary: Steven Nystrom, NSPS (USA)
(To be finalised at one of the next meetings of the Working Group 9.3)
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Chair
of FIG Commission 9
Peter Ache
peter.ache[at]dvw.de
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