EAA publishes new edition of European Standards for Statistical Valuation Methods

The third edition of the European Standards for Statistical Valuation Methods for Residential Properties (ESSVM) becomes effective on 1 March 2022 and aligns with the latest EU legislative and supervisory provisions like the Covered Bond Directive and the EBA guidelines on loan origination and monitoring.

In addition, the new ESSVM provide detailed guidance as to the appropriateness of statistical valuation methods for specific purposes, emphasising the qualitative differences regarding their complexity and sophistication and the advancement of their mathematical and technical approaches, which are directly linked to their granularity as well as their ability to provide property-specific valuations.
 
Independently peer-reviewed like its predecessors, the third edition of the ESSVM focus further on guiding users and regulators when assessing accuracy, objectivity and reliability of statistical valuation methods, and specifies concepts such as “advanced statistical models”, with their prescribed characteristics matched against existing solutions.
 
Feedback from all stakeholders, and regulatory bodies is very welcome, and like before any emerging market needs will continue to be considered.

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