Valuations in a tech-enabled future
What will clients want from valuers and valuations in a tech-enabled future? Sander Scheurwater reviews the latest research findings.
1 JUN. 2018
Without security of tenure, millions are at risk of dispossession, crime and corruption. How is the problem being addressed?
Are you able to prove that you own your home? If you are a Modus reader who is also a homeowner, you almost certainly can. But this level of land tenure security is very far from being the global norm. In developing nations it is downright unusual: about 70% of land and property is unregistered. The World Bank suggests that perhaps 90% of residential and commercial property in Africa is untitled.
“To identify properties and register them to provide certainty of occupation and ownership requires a legal system that defines title, a process for registration and an infrastructure that allows that to happen,” notes Richard Baldwin, global practice lead for land tenure and property rights at international development company DAI. “In some countries all those things may be missing.” In places where land tenure is not formally recorded, land and property may be misappropriated; personal economic opportunities are restricted; would-be investors face significant financial, legal and reputational risks; and governments cannot raise money through property taxation.
In recent years the need to address this problem, which affects millions of people worldwide, has been more widely recognised. The issue of land governance now has a prominent place in the UN’s Sustainable Development Goals, adopted in 2015. The first of these goals, which calls for an end to poverty, includes a target for equal rights for all to ownership and control over land and other forms of property by 2030.
The only trouble is that there is no chance the target will be hit. The task is just too big. Take India, for example. About two-thirds of the 7.5 million civil court cases under way in India during 2016 were related to land and property. Most of the litigants were individuals considered to be from low castes who have low incomes, according to a study by the civil society organisation Daksh. More than 6 million of these cases had been stuck in the system for more than five years.
Nor can citizens necessarily rely on the authorities being prepared to fight for people who are dispossessed. Of 289 internal conflicts reported in India during 2016, 80% were caused by development and industrialisation projects – most the direct result of the government taking possession of land without the consent of local communities. The survey was conducted by the Rights and Resources Initiative, which advocates for the land rights of indigenous and local communities, and by the Tata Institute of Social Sciences. It showed that these conflicts affected 3.2 million people and put more than $179bn of investments at risk.
In Kenya, Transparency International is also trying to help people adversely affected by corruption related to land rights. “We hope to do this by securing tenure for all types of land, rural and urban,” says Samuel Kimeu, executive director for the NGO in Kenya. The organisation has developed a software tool that anyone can download to learn more about the process of trying to » secure tenure. It is also focusing efforts on better recognition and protection of the rights of women in relation to land ownership.
Poor land rights security is not good for government, either. One of Transparency International’s other campaigns in Kenya is based around securing tenure for state schools, some of which lose land to corrupt officials. “For a big percentage of all the schools in the country, their land is at risk,” says Kimeu. “Just the other day I saw that a school, which has existed for 30 years, had been given two weeks to vacate land because someone else is claiming they own it.”
The economist Hernando de Soto argues that a lack of formalised land rights is a fundamental reason for the economic weakness of states. If people are excluded from formalising land and property rights, he asserts, a black market will be created, along with “dead capital” related to the land in question that cannot be taxed, capitalised or protected through the rule of law.
But if the potential benefits to be gained from solving the problem are obvious, so too is its dizzying scale. What steps can be taken – and are already being taken – to begin to address these issues in very different societies the world over?
About two-thirds of the 7.5 million civil court cases under way in India during 2016 were related to land and property.
In helping to create accurate land registers and cadastre mapping, the role of the surveyor is, understandably, vital. But surveying to the usual standards demanded of professionals in more established markets is too time-consuming and costly for this task.
“It will take many hundreds of years to get the job done if we continue to work with traditional surveying methods,” says Kees De Zeeuw, director at Kadaster International, the Netherlands’ Cadastre, Land Registry and Mapping Agency. “Society cannot wait that long. We have to think of new ways to work.”
Technology has made this possible, in the form of satellite photography, mobile apps and open-source data management software. “If you buy satellite imagery off the shelf that’s a year old, it’s relatively cheap,” says Baldwin. “We also have mobile devices able to record spatial information and attribute information about owners; and we can link smartphones with GPS devices by Bluetooth and get accurate mapping to within 1.5m.”
These technologies enable so-called fit-for-purpose (FFP) land administration, which enables local people, assisted by land professionals such as local surveyors and para surveyors, to survey properties to a standard that is good enough to meet practical requirements.
“Plus or minus 1.5m is probably good enough,” says Baldwin. “You use satellite photography and then mark the boundaries on it with the agreement of the community. That means costs can be reduced from $30-$50 per parcel to between $5 and $10.”
The most successful implementation of FFP to date has, arguably, been in Rwanda. Following a successful pilot in 2009, nationwide land registration was completed in just four years. More than 100,000 local people were employed during the project, which saw 10.4 million parcels of land being registered and 8.8 million land lease certificates issued at an average cost of $6 per parcel. The method is now being used in other countries, including Namibia, Mozambique and Ethiopia.
“We’ve got away from the idea of heavily trained surveyors and precision GPS, to using technology that is much more pervasive,” says Baldwin. “But the surveyor is still needed. They can oversee the process and help to manage interaction with communities and adjudication processes in disputes between neighbours.”
These techniques are also proving useful in other situations. De Zeeuw cites work that Kadaster International has done in Nepal since the huge earthquake of April 2015, which killed around 9,000 people, injured almost 22,000 and destroyed thousands of homes. In some cases entire villages were wiped out, and many people lost any documents that proved ownership of their land. Kadaster and other groups are working with the Nepalese National Reconstruction Authority on pilot projects that will help individuals and families access the legal and financial resources they need to claim tenure and rebuild their homes.
Progress towards creating a more reliable land registry within individual countries is being complemented by international initiatives. The UN Habitat Global Land Tool Network seeks to alleviate poverty through land reform and improving security of tenure. It is currently running public education projects focused on this issue in Uganda, Kenya, Mozambique and Ethiopia, and sister organisation UN Global Geospatial Information Management is helping to promote FFP.
Meanwhile, RICS is among more than 30 organisations working on the International Land Measurement Standards (ILMS) Coalition, which was launched in mid-2016. A Standards Setting Committee is working on a draft standard for land transfer, to be published for consultation later this year. It will focus on removing risk from the land transfer process and strengthening tenure security, land rights, investment and governments’ revenue-raising capabilities.
“It’s about creating a global standard for things you need to know to do due diligence,” says Duncan Moss FRICS, principal consultant for Scotland at Ordnance Survey, and vice-chair on the ILMS committee. “But it’s also about protecting the seller. The longer-term aspiration is that governments start to listen to the demand for this type of information and invest in institutions and systems that will provide it.”
Ultimately, there will also need to be some political force behind such initiatives. “Land management is the third most corrupt activity on the planet, so there are forces that don’t want the status quo to change,” says Robin McLaren FRICS, director of land information management consultant Know Edge, and co-author of guidelines on using FFP techniques in land administration published in 2016 by the UN Habitat Global Land Tool Network. “There has to be the political will to make this happen.”
It also needs active participation from professionals working within these countries. This is not always a given. McLaren says there has been little support for FFP projects among surveyors in some countries. “It’s a common problem across sub-Saharan Africa,” he says. “Numbers of surveyors are very small and they don’t want to embrace new technologies they fear would diminish their role.”
Those who resist may be harming their own long-term prospects. “Three quarters of the world does not have security of tenure,” says Moss. “Professionals have an opportunity to manage that process, to provide advice and to grow the industry across the developing world.”
The potential upsides to tackling these issues are almost endless, says Baldwin. He sees the registration of land as a first step in the creation of a market that can stimulate investment and allow local people to use land and property assets to support economic development. It is easy to dismiss as unrealistic long-term aspirations like the eradication of poverty. But the application of surveying skills, alongside practical, low-cost technology and political commitment can make a huge difference to lives, the rule of law and social and economic stability in countries all over the world, and those far-off goals draw just a little bit closer.