Propertymark / NAEA Qualification (Level 3 Estate Agency) Marketing, Valuation and Appraisal Flashcards

24 sample cards from the Marketing, Valuation and Appraisal deck

Sampled from the end of the deck, so these are different cards from the ones shown on the syllabus page.

1. What is rising damp and how is it typically identified?

   Rising damp is ground moisture drawn up through walls by capillary action where a damp-proof course is absent or bridged. It typically shows as tide marks and salt deposits up to about a metre above floor level, peeling decoration and a musty smell.

2. What is subsidence and what commonly causes it?

   Subsidence is the downward movement of the ground beneath a building's foundations, causing the structure to sink and crack. Common causes include clay soil shrinkage in dry weather, nearby tree roots, leaking drains and former mining. It often leads to higher insurance premiums and lending caution.

3. Why is Japanese knotweed a concern in property sales?

   Japanese knotweed is an invasive plant whose roots can damage structures and which is very difficult to eradicate. Its presence must be disclosed (e.g. on the TA6 form), can deter buyers, may require a professional treatment plan with guarantee, and can affect mortgageability.

4. Why has cladding become a major material disclosure issue?

   Following the Grenfell Tower fire (2017), unsafe (e.g. ACM/combustible) cladding on flats raised fire-safety, insurance and remediation concerns. Affected flats may be hard to sell or mortgage; an EWS1 form is often required to confirm the external wall system's fire safety status.

5. What is an EWS1 form?

   The External Wall System (EWS1) form is an industry assessment confirming whether a building's external wall system (including cladding and balconies) meets fire-safety requirements. Lenders may require it before granting a mortgage on flats in taller multi-occupancy buildings.

6. What is a listed building?

   A listed building is one of special architectural or historic interest placed on the statutory list, giving it legal protection. Listed building consent is required for alterations affecting its character, in addition to any normal planning permission.

7. What are the grades of listed buildings in England?

   Grade I - buildings of exceptional interest; Grade II* - particularly important buildings of more than special interest; Grade II - buildings of special interest (the most numerous category). Scotland and Wales use different category systems (A/B/C and I/II*/II respectively in Wales).

8. What is a conservation area and how does it affect a property?

   A conservation area is an area of special architectural or historic interest whose character is protected. Stricter planning controls apply: extra consent is needed for demolition, works to trees are restricted, and permitted development rights are often curtailed - all of which must be disclosed to buyers.

9. What is the NHBC and what does it provide for new-build homes?

   The National House-Building Council (NHBC) is the leading UK warranty and insurance provider for new homes. Its Buildmark warranty typically gives a 10-year cover: a builder-liability/defects period in the first 2 years and structural insurance cover for years 3 to 10.

10. What does a typical new-build 10-year warranty (e.g. NHBC Buildmark) cover in each phase?

    Years 1-2: the builder is responsible for putting right defects caused by failure to meet NHBC standards. Years 3-10: insurance cover against the cost of repairing structural damage and certain other specified defects. Cover begins from legal completion.

11. Name common alternatives to NHBC warranties for new homes.

    Premier Guarantee, LABC Warranty, Build-Zone, Checkmate (CRL) and an architect's Professional Consultant's Certificate are recognised alternatives accepted by many lenders.

12. What is a sale by private treaty?

    A private treaty sale is the most common UK method: the property is openly marketed at an asking/guide price and the seller negotiates privately (via the agent) with interested buyers until terms are agreed. The sale is not legally binding until contracts are exchanged.

13. At what point does a private treaty sale become legally binding?

    On exchange of contracts. Before exchange either party can withdraw without legal penalty (subject to abortive costs), which gives rise to gazumping and gazundering. Completion follows exchange.

14. Define gazumping and gazundering.

    Gazumping is where a seller accepts a higher offer from another buyer after already accepting one, before exchange. Gazundering is where a buyer reduces their offer shortly before exchange, exploiting the seller's commitment. Both are possible because nothing is binding until exchange.

15. What is sale by traditional auction and when does the sale become binding?

    In a traditional auction, the property is sold to the highest bidder in the room (or online) at the fall of the hammer, at which point contracts are exchanged and a deposit (typically 10%) is paid. Completion usually follows within 28 days. The sale is legally binding immediately.

16. What is the 'Modern Method of Auction' and how does it differ from traditional auction?

    In the Modern Method (conditional auction), the winning bidder pays a non-refundable reservation fee and is granted an exclusivity period - typically 28 days to exchange and a further 28 to complete (about 56 days total). Unlike the traditional method, contracts are not exchanged at the hammer fall, giving buyers time to arrange a mortgage.

17. What is a key advantage and a key risk of selling by auction?

    Advantage: speed and certainty - a binding sale at the fall of the hammer (traditional) and competitive bidding can drive price. Risk: the property may sell below market value if bidding is weak, and the reserve must be set carefully to protect the seller.

18. What is a 'reserve price' and a 'guide price' in auctions?

    The reserve is the confidential minimum price below which the seller will not sell; the property cannot be sold for less. The guide price is the published indication of the likely selling range to attract bidders, and is usually at or close to the reserve.

19. What is sale by sealed bids (informal tender)?

    In sealed bids, interested parties submit their best and final offers in writing by a set deadline, unaware of competing bids. The seller then chooses an offer (not necessarily the highest). It is used for high-demand or unusual properties to maximise price and is not binding until contracts exchange.

20. How does a formal tender differ from informal sealed bids?

    In a formal tender the buyer's submitted bid, once accepted, is contractually binding (the contract is effectively concluded on acceptance), whereas informal sealed bids merely identify a preferred buyer and the sale still proceeds to a normal exchange. Formal tender is more common for commercial or development land.

21. What is an online-only estate agency model?

    An online (or 'online-only') agent markets and manages the sale primarily over the internet and phone, usually for a fixed fee paid upfront (whether or not the property sells), often with the vendor handling viewings themselves. It has no high-street branch network.

22. What is a hybrid estate agency model?

    A hybrid agent combines online efficiency with some traditional services - typically a fixed or low fee plus access to local property experts who can do valuations, accompanied viewings or negotiation. It sits between online-only and full-service high-street agents.

23. Compare fee structures of traditional high-street versus online/hybrid agents.

    Traditional high-street agents usually charge a percentage commission payable on a 'no sale, no fee' basis on completion. Online/hybrid agents typically charge a lower fixed fee, often payable upfront regardless of whether the property sells, sometimes with a deferred-payment option.

24. What is the main consumer trade-off between online-only and full-service agency?

    Online-only agents offer lower upfront cost but the seller bears more work (viewings, negotiation) and risk (fee paid whether or not it sells, less local market expertise). Full-service agents cost more (percentage commission) but provide local knowledge, accompanied viewings, active negotiation and no-sale-no-fee security.

What this deck covers

Marketing, Valuation and Appraisal flashcards FAQ