1.1

The purpose of checking sales prior to calibration of the Automated Valuation Model (AVM) is to ensure that sales not representative of the open market, or otherwise not useful, are rejected and that the property attribute data of those sales that are to be used is accurate. Using only open market sales with correct property attribute data will minimise the number of outliers produced by the AVM and is fundamental to producing robust valuations. The importance of carrying out these tasks cannot be overstated.

1.2

Sales Verification and Validation processes have been introduced to identify the Open Market Value (OMV) sales that will be used in the calibration process possess and ensure that they have attribute data which reflects accurately the physical state of the property on the date of sale.

The aim is that the majority of the sales to be used in the model will have a full and correct set of all 17 property attributes and that the remaining minority will have correct information for at least the main eight attributes (Group, Type, Age, Area, Rooms, Bedrooms, Bathrooms, Floors / Floor Levels).

Sales Verification and Validation must be completed by on all available domestic transactions, where the effective date of transaction falls between 1 July 2003 and 30 June 2005, by 30 September 2005.

1.3

CTR(E) IA 100504 – Data Enhancement of Dwellinghouse Codes;
CTR(E) IA 240604 – Sales Verification Stage 1;
CTR(E) IA 110804 – Data Enhancement of Dwellinghouse Codes – External inspections;
IT IA 021204 – Property Details Activity Codes and Validation Codes;
IT IA 190105 – Value Significant Codes and Maintain Questionnaire Details; and
CTR(E) 310105 – Property Details Activity Codes and Validation Codes.

1.4

Definitions of the terms used are provided below:

Verification (Formerly Verification Stage 1)

• Identification of sales that are potentially to be used in the AVM;
• Rejection of sales that are obviously not OMV;
• Rejection of non-useful OMV sales.

Validation

• Confirmation of the accuracy of recorded property attributes where the sale is useful;
• Addition/correction of data held against useful sales where the coding is incomplete or incompatible;
• Confirmation of effective dates (particularly for new properties).

1.5

The process will be controlled using the Sales Verification and Validation (SVV) spreadsheet for each Billing Authority (BA).

This spreadsheet contains a macro that combines the Oasis Input File and the Oasis Outputs that identify Outliers and provide Sales Ratio results.

The SVV spreadsheet must be produced by the Team Leader or Technical Advisor and saved as a zipped file in the Group P drive as ‘SVV_BA Name_Date of Creation’, for example ‘SVV_1234_050228’.

Team Leaders should complete spreadsheet column B with allocated case owner, and indicate using ‘Y’ in columns C to F which method of validation is required.

Instructions for production of the spreadsheet have been supplied to Team Leaders and Technical Advisors under separate cover.

1.6

Domestic Summary Reports (DSRs) should still be produced in locations to monitor the quality of manual SDLT/PD input. Transactions received electronically are linked on matching, either automatically or manually, to the Group Office that owns the lead BA code, and will only appear on the DSR for the Group Office.

Locations therefore need to output two DSRs each week for:

their Office Number – for all transactions input manually;
their Group Office Number – for all transactions received electronically.

2.1

Electronic transfer of transaction information is now in place for all freehold transactions. A number of these transactions require manual address matching where the address given in the SDLT form does not match the address in the VOA Property Directory.

2.2

SDLT transactions and forms for domestic transactions must be matched / input as soon as possible after receipt and backlogs kept to a minimum.

Attention must be given to any processing backlogs of transactions involving domestic property where the effective date of transaction is 1 July 2003 or later. All domestic transactions with effectives dates between July 2003 and June 2005 are important.

The critical transactions are those with effective dates that fall into the period three months either side of the AVD, ie between January 2005 and June 2005. These must be given high priority as soon as they are received.

2.3

The process of Sales Verification must be undertaken on all properties with ‘edit fails’ on the SVV spreadsheet, for instance data issues or sales that do not appear to be OMV where a relevant transaction type has not been entered.

2.4

On receipt of the SVV spreadsheet from the CTR Team Leader, the nominated reviewer must check all transactions that have failed the edits giving special attention to checking the following:

• the address has been correctly matched;
• the date of transaction is correct;
• the consideration is correct;
• the Interest code is correct;
• any transaction types that explain why the property is not market value have been input.

2.5

Where there has been an inputting error at registration stage or a transaction type has been omitted, the central database must be updated via the Amend Basic Transaction functionality.

Queries on SDLT forms which relate to transactions with an effective date of transaction of 19 July 2004 or earlier must be made in accordance with the instructions contained in LT IA 071004.

The facility for amending transmitted information and for viewing all of the information on SDLT forms will be available later this year.

2.6

Once all relevant transactions have been checked and the central database corrected if necessary, the SVV spreadsheet must be updated by typing ‘A’ into column H – ‘Sales details checked & changed on CDB if necessary (A Code)’

The presence of an ‘A’ in column H denotes that no further verification work is necessary and therefore no duplication of effort will take place.

3.1

Sales Validation must be undertaken on all sales with effective dates of transaction between 1 July 2003 and 30 June 2005 that appear to be OMV and are not rejected as non-useful.

This includes those where the property attributes appear to be complete and compatible, as we need to be absolutely sure that our records are correct for the sales that will eventually be used as comparables to value many other dwellings.

Sales with effective dates of transaction between 1 September 2004 and 31 January 2005 must be given priority as well as all Outliers generated with effective dates since July 2003. Consideration needs to be given to validating sales ratio Outputs from Oasis as part of this process; the Team Leader or Technical Advisor will prioritise these as they deem appropriate.

3.2

The SVV spreadsheet will be used to identify useful sales that fall into the following four categories:

• sales, in particular new properties, where the effective date of the property details is later than the effective date of transaction or where there has been incorrect address matching on receipt of the transaction causing the sale property to appear to be uncoded on the spreadsheet;
• sales that are coded with the eight main codes;
• sales that appear to be incorrect because the property details recorded are not reflected in the transaction price, for instance where there has been an extension which is not known to the VOA;
• sales where the property details are incompatible or where one or more of the codes is missing.

3.3

The activities undertaken for the Sales Validation Process will be similar to those used in Data Enhancement, ie Inspection and Questionnaire. The task can be undertaken at the same time as Data Enhancement. It is therefore important that progress of Data Enhancement is monitored and that Property Details Activity Codes are used correctly so that efforts are not duplicated.

Details of the Property Details Activity Codes can be found in IT IA 021204 and CTR(E) IA 310105.

4.1

Where there are no Property Details shown attached to a sale on the SVV spreadsheet, before taking any more steps in the Sales Validation Process, the effective date of the Property Details attached to the property should be investigated.

Careful checking of DSRs and correction of effective dates after input or matching of SDLT forms / PDs will ensure that fewer transactions will appear on the SVV spreadsheet with no property details attached.

It will be possible in future for a spreadsheet to be produced centrally that will list the properties that have no property details attached to the sale but do have some attribute data with a later effective date. Whilst data collection is still incomplete the current quarterly download will not highlight these properties.

4.2

When Property Details are added to, or amended for any reason, through current work or CTR2007 activities, it is important that the set of Property Details with the most recent effective date is the most complete.

The most recent set of property details should be the set that reflects the state of the property as it is today. The effective date of those property details should be the date that the property took on that state. For new properties this effective date is the date of transaction or the date of completion if prior to the sale.

More information on Property Details effective dates will be provided in a future Local Taxation IA.

4.3

The most common reason why a new property will appear on the file with no Property Details is that the coding has been input after the property has been banded at report clearance stage, using the effective date of the CT band as the Property Details’ effective date.

4.4

To ensure that the complete set of property details is attached to the sale, the property details history will need to be checked in the ‘Amend / Delete Existing Details or Create New Details’ screen. This can be accessed by pressing <Ctrl F4> from the Property Details Screen.

Where there is a set of Property Details for a new property shown in the history with an effective date later than the effective date of the transaction, this is likely to be the set input at CT report clearance stage. The effective date of these Property Details must be changed to the effective date of the transaction.

4.5

It is expected that these Property Details will have been completed as a result of the banding process, but nevertheless they must be checked as part of the Validation Process.

Where the address has been changed from plot number to postal number, the transaction should be relinked to the new address making sure that the effective date of the property details is the same as the effective date of transaction.

5.1

The processes involved in the Validation of sales comprise some of the same activities as data enhancement.

It is not necessary to revisit the hardcopy records for Sales Validation since data on all sales that are useful will require validation by questionnaire or external/internal inspection.

The processes involved are detailed below.

External Inspection
Obtain factual information that can be seen from external inspection such as the Group, Type, Age and Parking. Make judgements about the property, (extrapolation), where possible based on factual information gathered from similar properties in the locality. Check the vicinity for any factual information about the neighbourhood that could have an effect on value eg sewage works, sea view.

Physical Inspection
Obtain factual information either from internal inspection or inspection from within the curtilage of the property, and always with the knowledge/consent of the occupier. A physical inspection should result in all property details being obtained. Information regarding changes made to the property since the date of sale should also be obtained.

Questionnaire
Issue where the property cannot be seen from the road or where missing data can be best gathered using this method and a physical inspection is not justified, such as information regarding number of rooms, bedrooms, bathrooms, floor level, parking, etc. Information regarding changes made to the property since the date of sale should be obtained.

Team Leaders should make a judgement about the most appropriate and efficient method of obtaining property details information for properties with useful sales.

In BA areas where data enhancement has already started, the processes already undertaken should not be repeated. Where an enhancement process has not resulted in the property being coded completely, an alternative process should be used to complete and validate the property details. Proper use of Property Details Activity Codes will make it easy to identify what approaches to enhancement have already been taken.

5.2

Although there is no requirement to revisit hardcopy records for Validation purposes where the Value Significant Code ‘M - Multiple’ has been recorded in the Property Details, it may be necessary to revisit the dwelling survey to collect any extra codes that have not been recorded during initial bulk data collection.

5.3

External Inspection
The Group, Type, Age and Parking for the dwelling can be confirmed by a site visit. Knowledge can be applied to validate details such as number of rooms, bedrooms, area etc. An inspection of the surrounding area can enhance the details recorded with the addition of any value significant information such as views or lack of street lighting.

5.4

Referencers should print the relevant part of the SVV spreadsheet and use this on site to record any amendments or extra information found as a result of the external inspection. On return to the office the sheet must be passed to a member of the support team for input to the central database. The SVV spreadsheet should be updated by overtyping ‘Y’ in column E with the date of inspection.

All extra information should then be input onto the central database via the bulk data capture screen. Where information is gathered or received about the vicinity that may affect the valuation of the property, the appropriate Value Significant Code (VSC) should also be recorded in Property Details. If the VSC applies to other properties in the vicinity, the records for all other properties affected should also be updated as part of the enrichment process.

5.5

Property Details Activity Code 40: ‘Data obtained from drive by inspection - estimated’ or 42: Data obtained from drive by inspection – factual’ should be entered with the date of inspection.

Property Details Activity Code 45: ‘Failed attempt to obtain data from drive by inspection’ is not appropriate for validation purposes unless all data was missing prior to the inspection and no data was collected either factually or estimated.

If no extra data has been collected through making an external inspection, but all available data has been validated, Activity Codes 40 or 42 should be recorded depending on how the information was validated.

If all available attribute codes have been obtained or validated by external inspection, Data Validation Code 1: ‘All attribute codes are from records, inspection or knowledge’ should be recorded.

5.6

The SVV spreadsheet must be updated by inserting ‘V’ in column G – ‘Property details checked & changed on CDB if necessary (V Code)’ to denote that the Property Details have been validated.

5.7

Where there is still data missing from the eight primary codes, a questionnaire should be issued or physical inspection made to gather the missing information.

5.8

Physical Inspection
A physical inspection is an inspection made with the knowledge of the occupier / owner of the property from within the curtilage of the property.

The SVV spreadsheet can be sorted by ‘Y’ in column F – ‘Physical Inspection Required (Y or Date Made)’ to find the properties that require a physical inspection.

Inspections should be made using appointment letter VO7775, a copy of which is attached as Appendix 1. Where appointments are not convenient, taxpayers should be encouraged to give permission for an on-site external inspection with accommodation details confirmed over the telephone.

5.9

Referencers should print the relevant part of the SVV spreadsheet and use this on site to record any amendments or extra information found as a result of the external inspection. On return to the office the sheet must be passed to a member of the support team for input to the central database. The SVV spreadsheet should be updated by overtyping ‘Y’ in column F with the date of physical inspection.

Any extra information gathered should be input to Property Details. Where information is gathered or received about the vicinity that may affect the valuation of the property, the appropriate Value Significant Code (VSC) should also be recorded in Property Details.

If the VSC applies to other properties in the vicinity, the records for all other properties affected should also be updated as part of the enrichment process.

5.10

Property Details Activity Code 70: ‘Data obtained from physical inspection’ should be entered with the date of inspection.

The SVV spreadsheet must be updated by inserting ‘V’ in column G – ‘Property details checked & changed on CDB if necessary (V Code)’ to denote that the Property Details have been validated.

It is expected that all available codes will be gathered or validated from a physical inspection and no further validation by any other method will be required.

5.11

Questionnaire
Where it is unlikely that information held can be validated by inspection, for instance where the property cannot be viewed from the road or where this method is not an efficient use of resource, issue of a questionnaire accompanied by letter VO7774 will be the most suitable method of validation. A copy is attached at Appendix 2.

The Team Leader must complete the SVV spreadsheet with ‘Y’ in column C – ‘Questionniare to be sent (Y or Date Sent)’.

5.12

The SVV spreadsheet can be sorted by ‘Y’ in column C to produce a list of properties requiring a questionnaire. The part of the spreadsheet consisting of columns I to O which contain the address details should be saved in the P drive under P\Council Tax\reval 2007\Questionnaires as a separate document entitled ‘SVV_BA Name_Date of Original Spreadsheet_Mailmerge’ to enable a Mail Merge to be carried out.

If the list of properties is not saved as a separate document, the Mail Merge will include all properties on the original spreadsheet.

Instructions on how to complete a Mail Merge are attached as Appendix 3.

The ‘Y’ in column C - ‘Questionnaire to be sent (Y or Date Sent)’ on the original SVV Spreadsheet must be overtyped with the date of issue for all properties included in the Mail Merge.

5.13

On receipt of a completed questionnaire, the details provided by the taxpayer must be checked carefully against the data held and, if a telephone number has been provided, any inconsistencies verified with the person who completed it.

Any extra information gathered must be input to the central database via the bulk data capture screen and Property Details Activity Code 30 entered with the date of receipt of the questionnaire.

Where information is gathered or received about the vicinity that may affect the valuation of a property, the appropriate Value Significant Code must be recorded in Property Details. If the information received applies to other properties in the vicinity, the records for all other properties affected should also be updated as part of the enrichment process.

5.14

The SVV spreadsheet must be updated by inserting ‘V’ in column G – ‘Property details checked & changed on CDB if necessary (V Code)’ to denote that the property details have been validated.

If, 30 days after issue, the questionnaire has not been returned, the central database should be updated with Property Details Activity Code 35.

The Team Leader must then decide on the most appropriate alternative method of validating the Property Details and update the SVV spreadsheet with ‘Y’ in either column E or column F so that an inspection is carried out.

5.15

Completed questionnaires should be filed with the Missing Data Questionnaires in coloured wallets in alphabetical order of street name within BAs and retained in the location.

5.16

External Inspection or bulk issue of questionnaires, accompanied by letter VO7774, are both effective methods of gathering extra information where sale price seems inconsistent with the Property Details. Team Leaders should make a judgement as to which method to use, based on locality and resource implications.

6.1

In the near future it is intended that a new Reason Code for Property Details (V) and a new AVM Sales Verification Code (A) will be added for Outlier purposes to denote that the sale has been checked and validated/verified so that no further enhancement needs to take place. In BA areas where Data Enhancement is still being carried out, this measure will ensure that accurate property details are not changed as a result of other Data Enhancement processes.

6.2

One of the common reasons for the sale price being perceived as high in relation to the Property Details is where there have been alterations to the property which have not been notified to the LO.

6.3

If, in the course of undertaking an inspection or having received a completed questionnaire, it is found that alterations have been made to a property that will affect the Property Details, a LOR with reason CR10 should be raised immediately and activated so that these alterations can be investigated for the current list.

6.4

This report should be dealt with in accordance with the instructions for current work and any band change should have the effective date of transaction as its effective date.

6.5

For CTR2007 purposes the Property Attributes should be amended and ‘R’ recorded in the Reason field so that the changes may be taken into account for the 2007 List.

When Property Details are added or amended for any reason through current work activities, it is important that the set of with the most recent effective date should always be the most fully coded set. The most recent set of property details should be the set that accurately reflects the state of the property as it stands today. For activated CR10 purposes the effective date of those Property Details should be the date that the property took on that state, ie the date of the alteration.

If the effective date of the alteration is unknown, then the effective date of the relevant transaction should be entered as the Property Details effective date.

The appropriate Inspection Activity Code should be input on clearance of the CR10 report in accordance with IT IA 211004.