A desktop valuation is, as the name suggests, something that’s used by property surveyors and property finance companies to undertake valuations without having to physically attend the property.
A desktop valuation is an automated and software driven type of property valuation that is derived from certain criteria and usually used for lower risk lending that’s under 80% Loan To Value (LTV). Things like postcode, online research and pictures provided by the client.
Given recent events from 2020 onwards, the prevalence of these types of valuations has increased markedly in recent times.
The popularity of these types of valuations has increased along with the popularity of property development with a huge increase in demand for property and rising prices over the last 2 years. We’ve all seen the high street changing over the last few years and this is due, largely, to the changing face of how commercial properties and other types of real estate are used and developed. With such a large demand for new types of investments, finance companies have responded by using innovative ways of doing business.
There’s been a noticeable increase in property developers since 2019 and, broadly speaking, this still hasn’t managed to keep up with demand for property in that same time so it’s still expected that this will rise further throughout this year and next.
Example of a desktop Valuation
When applying for commercial lending most of our panel of lenders will look to get an idea of what the property’s worth in order to work out how much they’d be willing to lend to you.
In order to do this they’ll often ask you to pay for a survey to be undertaken so that a specialist can come out to the property and do an inspection to see what sort of state the building is in, how big it is, what the potential is for development and what sort of area it’s in too.
With desktop valuations this can be done digitally without the need to send specialists out for surveys. For example, if you’re looking to take out some bridging finance in order to develop some old retail units into flats or housing before arranging a mortgage, the company will often either ask you to pay for surveys or will send one of their representatives to do it.
With desktop evaluations that can be done by asking you to send pictures and evidence, by the company searching the property online and also running those details through software to get a good idea of what the property might be worth on the open market, this then allows them to give you a much more accurate quote for finance.
Desktop Valuation vs full valuation
When it comes to desktop valuations they are used by some lenders as a quick way to underwrite a loan working on the assumption that there is enough data available about the property and that it is in a reasonable state of repair.
Desktop valuations aren’t as reliable traditional valuations for a few reasons. For example, a desktop type of valuation is considered accurate if the property has been sold in the last ten years, the property hasn’t been substantially changed since the last time it was sold, is a relatively standard size and there are a number of other similar properties for sale or sold in the same area.
Times when this desktop type of valuation wouldn’t be considered very accurate are if the property hasn’t been sold for 20 years or more, the property is unusual in size or location or if there are very few other properties of its type locally.
Your lender will let you know which types of valuations they consider accurate when you reach out to them.
How much is a desktop valuation in the UK?
It varies and will usually depend on which types of surveyors your lenders use and which they’ll accept, but broadly speaking you should expect to pay somewhere between £75 and £200.
Again, the lender will give you more information about this, and if you’re unsure speak to one of brokers and they can advise you further.
How long do desktop valuations take?
Typically, a desktop type valuation is instant, or takes a very short amount of time as they’re intended to be done almost instantaneously depending on the information that’s available to them and what you can send to their desk.
This is something the surveyors will be able to advise you on.
What type of properties can desktop valuations be used for?
There’s a variety of property types that can use this type of desktop evaluation process. It can also be used for residential in some circumstances but more typically is used for commercial surveys.
- Mortgage – If you’re looking to arrange a mortgage for your property then you can ask lenders if they’d be willing to accept a desktop survey.
- Re-mortgage – If you’re looking to raise capital from your property and you already have an existing mortgage then there’s the opportunity to try and re-mortgage it, and the chances are you’d want to get a new valuation as it would mean being able to get a higher loan.
- New Build – If you’re looking to raise finance on a new build house or get a loan to be able to start one from scratch then you may be able to get the building or the land evaluated.
- Lease extension – If your property is on leasehold land then extending your lease can increase the value of your investments, an evaluation or survey may be suitable to be able to know the updated value of your investments.
How accurate are desktop valuations?
They’re not as accurate as traditional surveys, but that’s why they’re used for lower risk loans and lending. These types of survey work on some assumptions that a traditional survey wouldn’t do.
Location data, other properties of a similar type in the area and photos of the state of repair of the building can be used to make an informed estimate of the value of a building but if you’d rather ask lenders for a traditional survey then you can do that too.
How do I get a desktop valuation for my property?
When you speak to lenders about a mortgage or loan you can discuss with them the possibility of using these types of valuations rather than a traditional type of evaluation.
Our team of brokers are experienced in dealing with these types of requests and because we have a large panel of lenders this is something that you can discuss with us at the point of your loan or mortgage application and we can assign an expert to see if there are lenders who may be willing to accept this type of valuation.
Need finance for your properties? Speak to our brokers
If you’re looking to speak to an expert about your finance situation then our team of brokers are at hand to talk to you about anything you need.
Due to years of experience there’s always an expert available to talk you through your options and provide you with the advice you need.
Because we’ve helped to fund millions of pounds worth of finance and loans over the years we’re qualified to provide the right advice about your application and give you the best possible chance of being approved, whether it’s to buy a building or raise finance on an existing investment we can let you know what’s available.
We’ve helped thousands of clients find the right loans because we have a panel of lenders that trust us to provide them with high quality applications that they can approve quickly, and they’re also able to provide us with exclusive rates and deals for our clients.
Our advice will help you get your project in the best possible shape and we can help with things like business plans, exit strategies and surveys too. We know what our panel want to see and can ensure you’ve ticked all the right boxes.
