Do You Need a Property Valuation for a Bridging Loan?

Property valuations don't always have to slow down your bridging loan.

There are faster alternatives available for many properties. Read on as we explain the different ways to value a property.

If you’re considering a bridging loan for your property purchase or development project, you might be wondering about property valuations.

Perhaps you need funds quickly for an auction purchase, or you’re looking to complete a property chain without delay.

The thought of waiting for a valuation might feel like an unwanted hurdle.

Well you may have more options than you think.

While property valuations remain standard practice for many bridging loans, the lending landscape has evolved. Modern alternatives like desktop valuations and automated systems can speed things up, and in some cases, you might not need a physical valuation at all.

Let’s look at what property valuations mean for bridging loans, when you’ll need one, and when you might have other choices.

Understanding Property Valuations in Bridging Finance

A property valuation for a bridging loan gives lenders a clear picture of what your property’s worth. When you’re seeking quick finance, the valuation helps determine how much you can borrow and under what terms.

For a standard physical valuation, a qualified RICS surveyor will visit your property.

They’ll look at everything from the building’s general condition to its location and compare it with similar local properties that have sold recently.

Costs vary based on your property’s value.

For a property worth £300,000, you might pay around £400 for a valuation. This increases to £750-£1,000 for properties worth £500,000, while high-value London properties over £1 million will cost £2,000 or more.

But physical valuations aren’t the only option.

“Desktop valuations” use existing property data and local market knowledge to assess your property’s value without a site visit. The assessment is still conducted by a qualified valuer, but without the need to visit the property.

These usually cost £150-£300 and can be completed within 48 hours. They’re particularly useful for straightforward residential properties in well-documented areas.

Automated Valuation Models (AVMs) offer a relatively new and quick solution.

These computer-generated valuations use statistical data to estimate your property’s worth in minutes. They’re the fastest option and usually cost under £100, though they work best for standard properties in areas with lots of comparable sales data.

Lenders will always prefer physical valuations for unique properties, development projects, or high-value loans. Sometimes they are needed for Below Market Value purchases.

However, many now accept desktop valuations or AVMs for standard residential properties, especially when you’re borrowing less than 70% of the property’s value.

Related: The Bridging Loan Application Process Explained

When is a Property Valuation Required?

You’ll almost always need a physical valuation for high-value properties.

Let’s say you’re buying a £2 million Georgian townhouse in Bath – lenders will want a detailed assessment because of the property’s value and period features. The same applies to a Victorian warehouse conversion in Manchester or a luxury apartment in Mayfair.

Complex properties also call for thorough valuations.

This includes listed buildings, properties with unusual construction (like thatched cottages in the Cotswolds), or homes with specific restrictions. For example, if you’re purchasing a Grade II listed farmhouse in Yorkshire, lenders need to understand any maintenance requirements or renovation restrictions.

Development projects require detailed valuations as lenders need to assess both current and potential future values.

Related: Do Property Developers Use Bridging Loans?

Factors That Influence Valuation Requirements

The amount you want to borrow compared to the property’s value (LTV) plays a big role.

If you’re looking to borrow 50% against a standard three-bed semi in Reading, you might qualify for a desktop valuation or an AVM. But if you need 75% LTV, most lenders will ask for a physical inspection.

The location matters because it affects the available data.

A flat in central Edinburgh might suit an automated valuation because there’s plenty of market data. But a remote cottage in the Scottish Highlands would need a physical valuation due to fewer comparable properties.

Different lenders have different comfort levels.

Some specialise in particular property types or regions and might accept simpler valuations where others wouldn’t. A lender familiar with London’s commuter belt might be more comfortable with desktop valuations for properties in those areas.

Let’s talk bridging loans!

Book your free consultation today and let’s discuss how we can help you achieve your property goals.

Alternative Valuation Options

Not every bridging loan needs a full physical valuation.

Modern alternatives can save you time and money in the right situations. Let’s look at what’s available and when these options might work for you.

Desktop Valuations

A desktop valuation relies on existing property data, local market information, and online resources. A qualified surveyor reviews everything from recent sale prices to planning records – all without visiting your property.

These work well for straightforward properties.

Say you’re buying a modern flat in Manchester city centre – there’s plenty of data about similar properties and recent sales in the area. Desktop valuations also suit situations where time matters, like preventing a property chain from breaking.

You’ll benefit from quicker results and lower costs, but there are limits. If the surveyor spots anything unusual or can’t find enough comparable properties, they might recommend a physical valuation instead.

Occasionally these can come back with a lower value than you had hoped for, sometimes because recent improvements or modernisations have not been picked up.

Automated Valuation Models (AVMs)

AVMs use computer algorithms to analyse property data and calculate values.

They pull information from multiple sources, including Land Registry data, past sales, and local market trends.

These systems shine when you need an instant indication of value. For example, if you’re interested in a standard three-bed semi in Southampton, an AVM could help you make quick decisions about potential borrowing.

AVMs work best for:

  • Properties in areas with lots of similar homes
  • Recent builds on established developments
  • Standard construction types
  • Lower loan-to-value deals

But they’re not suited for everything.

An AVM will struggle to value a converted chapel or a penthouse flat with unique features. They also can’t spot recent changes to a property or its surroundings that might affect value.

Some lenders combine these methods – perhaps starting with an AVM, moving to a desktop valuation if needed, and only requesting a physical valuation if questions remain.

This stepped approach helps balance speed with security.

No-Valuation Bridging Loans

Some lenders now offer bridging loans without any formal valuation. This option works well if you already own the property or you’re an experienced investor who knows the local market inside out.

You might qualify for a no-valuation loan when:

  • You’re borrowing against a property you’ve owned for several years
  • The loan amount is low compared to the property value
  • You need to complete very quickly
  • The property is in a well-documented area with clear market values

Take a recent example – a landlord in Leeds needed quick funds to buy another property. Since they were only borrowing 50% against their existing buy-to-let flat, the lender agreed to proceed without a valuation based on local market data and the landlord’s experience.

The lending risk for them is quite low.

But there’s a trade-off.

While you’ll save time and money upfront, you might face slightly higher interest rates or fees. Also some lenders cap no-valuation loans at lower amounts or restrict them to certain property types or areas.

How Valuations Impact Your Loan

Your property’s valuation shapes several key aspects of your bridging loan.

It affects how much you can borrow, what you’ll pay, and how quickly you can get your funds.

Let’s say you’re buying a £400,000 property in Bristol.

If the valuation matches your purchase price, you might be able to borrow up to £300,000 at 75% loan-to-value.

But if it comes in lower at £380,000, your 75% loan would drop to £285,000. This could mean finding extra money to complete your purchase.

If you’re in a hurry be aware that different valuations have their own time-frames.

A physical valuation might add 5-7 days to your application.

For an auction purchase in Manchester, where you need to complete within 28 days, this timing could affect your choice of valuation type.

However, a strong valuation can work in your favour. If your property’s worth more than expected, you might have access to additional funds, based on the same LTV.

Understanding Loan to Value (LTV)

When you’re arranging a bridging loan or mortgage, you’ll hear the term ‘LTV’ quite a bit.

Put simply, LTV shows what percentage of your property’s value you want to borrow. For example, if you need £150,000 against a property worth £200,000, your LTV would be 75%.

Working out your LTV is straightforward enough.

Just divide your loan amount by the property value and multiply by 100.

A £300,000 loan on a £400,000 property gives you an LTV of 75%. Most bridging lenders offer up to 75% LTV, though some might go higher in certain cases.

Why do lenders care about LTV?

It helps them manage risk.

A lower LTV means you have more equity in the property, which gives the lender more security.

Think about it – if you’re only borrowing 60% of your property’s value, the lender has a good cushion if property prices dip or they need to sell quickly.

Your LTV affects what options you have.

At lower LTVs (say, below 65%), you might qualify for better rates or simplified valuations. Some lenders even offer desktop valuations for standard properties at 70% LTV or below. Higher LTVs usually need full valuations and might come with higher interest rates.

Remember that the ‘value’ part of LTV isn’t always just the purchase price.

For refurbishment projects, lenders might consider the property’s value after improvements. So if you’re buying a house in Leeds for £200,000 that will be worth £300,000 after renovation, some lenders might base their LTV on the higher figure.

Our loan to value calculator makes it quick and easy to work out your figures.

Working with a Broker

A finance broker’s experience can make a real difference to your bridging loan application.

They know which lenders accept different types of valuations and under what circumstances. For example, if you need a quick completion on a standard London flat, your broker can suggest lenders who accept AVMs for much faster results.

Brokers work with many lenders, from high street names to specialist providers, and private lenders.

They’ll know who offers desktop valuations for higher-value properties or who might consider no-valuation loans in the right circumstances.

They’ll also handle negotiations and paperwork, often speeding things up considerably. Many brokers have direct relationships with valuers too, which can mean faster appointments and quicker reports.

Property valuations play a key role in bridging finance, but you’ve got more options than you might think.

From full physical valuations to quick desktop assessments, the right choice depends on your property, circumstances, and how fast you need to move.

Consider what matters most to you – speed, cost, or detailed assessment.

Think about your property type and location. Are you looking at a straightforward residential property where an AVM might work, or do you need a more detailed valuation for a complex project?

Ready to explore your options?

Get in touch with us to discuss your bridging loan needs. We’ll help you understand which valuation type suits your situation best and find the right lender for your circumstances.

FAQ

A physical valuation usually takes 5-7 working days from instruction to report. Desktop valuations take 1-2 days, while AVMs provide instant, same day results.

Lenders wouldn’t generally want to lend without any indication as to price or valuation.

Even on a low 50% LTV, most lenders would look for an AVM as a minimum.

Yes, if the valuation comes in lower than expected, your maximum loan amount (and LTV) will reduce as it’s based on the property’s valued price.

However, if you initially wanted to borrow 50/60% LTV a down valuation shouldn’t affect you.

Desktop valuations involve a surveyor reviewing property data and local market information, while AVMs use computer algorithms to calculate values automatically.

Some lenders accept recent valuations (usually within 3 months) from other RICS surveyors, but they’ll need to validate the report.

Yes, commercial property valuations are usually more detailed and consider factors like rental income and business potential.

Usually yes, but if there’s a recent valuation from the first charge lender (within 3-6 months), some lenders might accept this instead of requesting a new one.

Related: 5 Smart Ways to Use Second Charge Bridging Loans

Remote or unusual properties usually need physical valuations as there’s less market data available. Some valuers might charge extra for distant locations.

Bridging valuations often include a 180-day value (for quick sale) alongside the market value, as lenders want to know the property’s worth if sold quickly.

Still have more questions?

Just give us a call on 0330 030 5050 to get matched with an expert.
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