Changes to Charities Act Valuation Report
The Charities Act 2022 has brought about several changes that impact charities and how they manage their assets. Over a two-year period, these changes are being implemented. One such change is the recent update to the Charities Act Valuation Report, which came into effect in mid-June 2023. Trustees who plan on selling land or property or granting a lease of more than seven years should take note of these changes.
A Charities Act Valuation Report aims to advise a Trust as to whether the charity has achieved the best possible price for any given property asset (prior to sale or purchase). We have highlighted below the significant changes that have been made to this report and how it is produced:
- Who provides the valuation – The first significant change is that certain members of the National Association of Estate Agents and the Central Association of Agricultural Valuers (CAAV) are now allowed to provide the valuation. This has expanded the pool of potential valuers, but they must still have the appropriate knowledge and experience of the property being evaluated.
- Valuation report content – The second significant change concerns the contents of the valuation report. The previous regulations were narrow and prescriptive, lacking provisions for exceptional circumstances, such as a sale to a special purchaser or cases where a charity lacks funds for repairs or to secure planning permission. The revised requirements are simpler and more flexible, allowing for consideration of these matters. The Charities Act expects trustees to employ a valuer with the correct experience and understanding of the Act’s requirements. Once the valuation report is obtained, trustees should follow the valuer’s advice. The report will provide the property’s value, along with clear guidance on how to maximise its value and the best marketing strategy.
If you have any questions about Charities Act valuations, please email firstname.lastname@example.org