Valocity enhances property valuation system to foster competition
The Commerce Commission has applauded recent updates made by Valocity, a provider of property data and digital services, to its online property valuation ordering system (VOS).
These changes come after an investigation raised concerns that the system’s structure could hinder competition among property valuers, potentially leading to higher costs for consumers.
Addressing concerns over competition
Valocity, a service provider in New Zealand’s residential property industry, works with major banks, mortgage brokers, and property valuers. It facilitates full market valuations (FMVs), which require physical property inspections and are commonly needed for higher-risk properties or borrowers.
Historically, borrowers were unable to select their preferred valuer, with fees and valuer assignments controlled by Valocity. The Commerce Commission argued this system limited competition, as valuers could not directly compete for assignments, potentially resulting in inflated FMV costs. Banks typically did not allow borrowers to independently arrange valuations, further compounding the issue.
Valocity’s valuation system changes
In response to the investigation, Valocity has committed to significant platform changes.
From March, borrowers using the VOS will have the ability to reject pre-set fees and request quotes from competing valuers. These adjustments aim to introduce more transparency and choice, fostering competition and likely reducing costs for consumers.
Commerce Commission chair John Small (pictured above) expressed optimism about the updates.
“This is an important market for tens of thousands of Kiwis each year, so we’re pleased that Valocity has agreed to make these changes to its online valuation ordering service,” Small said. “We always encourage consumers to consider their options when deciding the best deal for them, and it is no different for FMVs.”
Commerce Commission’s reminder to industry participants
The Commerce Commission has also engaged with other industry stakeholders, emphasising compliance with section 27 of the Commerce Act, which prohibits agreements that restrict competition.
More details about anti-competitive practices can be found on the Commerce Commission’s website.
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