Getting a Home Loan in Australia if you're living overs...
29 Nov 2023
If you’re in need of a fast or cheap property valuation, a desktop valuation may just be what you’re looking for.
But what does a desktop valuation involve? And is it worth getting one?
In this article, we’ll take you through how a desktop valuation works, the pros and cons, and how it differs from a full valuation.
As the name suggests, a desktop valuation is when a bank or lender works out the value of a property from the comfort of their own desk. They refer to data that’s publicly available online such as recent property data, relevant sales in the area, and comparable property listings to get an idea of the estimated value of a property.
This type of valuation can be carried out without a valuer ever having to physically view, analyse, and inspect the property.
A desktop valuation is typically carried out for low-risk loans (loans under 80% loan to value ratio). However, not all lenders have a desktop valuation option available to choose from as it can be considered unreliable (more on that below).
To sum up, a desktop valuation is:
When the time comes to make a decision whether to choose a desktop valuation, you want to weigh up the pros and cons.
|Cheaper than other valuation methods because the valuer does not need to visit the property||Can make a lot of assumptions about a property as the valuer isn’t physically visiting the property|
|Quick process - can be complete in the matter of a few minutes||In certain areas they may only be a few comparable properties and little historical data available - incomplete data|
|Can be a reliable method as long as there is plenty of data available to value the property||Some properties may be ineligible for a desktop valuation due to location (rural), or type of property (farm)|
While a desktop valuation is done from the appraiser’s desk, a full valuation requires an appraiser to physically visit the property.
Typically, a full valuation will be required when a loan has a high-risk loan to value ratio, when the property is in a rural location, or when the type of property is unique (i.e. a farm).
During their inspection, the valuer will take pictures of each room, closely examine all the features of the property, note down any recent renovations, record details of zoning restrictions, and produce a list of local area landmarks (i.e. schools, shops) to create a detailed and accurate property report.
Unlike a desktop valuation which can be completed in a matter of minutes, a full evaluation can take up to seven working days. Factors such as availability, convenience, and the sheer size of producing a full evaluation can alter the timeline.
Both a desktop valuation and full valuation generally lasts for 90 days. Although uncommon, some lenders may allow a full valuation to last up to 6 months.
Not all lenders offer desktop valuations purely because they can give unreliable results.
Because a desktop valuation doesn’t require someone to physically visit the property, it’s difficult to know whether the property is in a reasonable condition i.e. has it been renovated or altered?
Without a full valuation, only assumptions, based off of online data, can be made about the property - the full picture isn’t clear.
Additionally, if the property hasn’t been sold in the last 10 years, there may not be any up-to-date sales data available to give an accurate estimate of the property’s value.
On the flip side of the coin, a desktop valuation is considered reliable when the property has been sold in the last 10 years, the property has not been substantially changed, and there are many comparable properties currently on the market or recently sold.
At loans.com.au, we offer a free property report that will include extensive information about the property you are planning to buy or sell from market-leading property research company Core Logic. We also allow for desktop valuations on eligible properties, to help save you both time and money.
As Australia's leading online lender, loans.com.au has been helping people into their dream homes and cars for more than 10 years. Our content is written and reviewed by experienced financial experts. The information we provide is general in nature and does not take into account your personal objectives or needs. If you'd like to chat to one of our lending specialists about a home or car loan, contact us on Live Chat or by calling 13 10 90.