has been designed and developed by the Australian Property
Institute (API) for residential mortgage valuations and is a good
example of how a report should be constructed and the basic parts of
valuation report. The form has flexibility to allow its use for
almost all residential valuations.
guidance notes cover extremely well and in detail the preparation and
deliverance of the report to a residential mortgagee.
VALUATION AND SECURITY ASSESSMENT PRO FORMA
guidance notes are for the guidance of mortgage clients and related
third parties who rely on such reports, to acquaint them with:
instructions to the Valuer and what information should be provided
- the information
the Valuer should provide in the report
- the matters the
Valuer may provide restricted comment on
- what the valuer
should do in the event of a departure from any provision
- matters the
Valuer understands will be checked by the lender and/or its solicitor
(and which may subsequently be referred back to the Valuer for comment).
- the information
and documentation the Valuer could be expected to hold on file.
using this report format certify that the report is made in
accordance with the guidance notes and advise that the report must be
interpreted with it. It should be noted that the format is
specifically designed for the purpose of providing a brief report on
residential property for mortgage purposes only and is not designed
for use for other purposes.
Institute recommends that lenders only request Valuers to provide
more comprehensive reports:
- where the
property has significant potential for redevelopment or where a major
redevelopment project is proposed, or
- if special
circumstances warrant, such as potential for an alternative non
Institute encourages residential mortgage lenders and related third
parties to require Valuers to use the this format. The Institute also
asks its Valuer members to provide the format to residential mortgage
clients who do not specify a particular report format and to
encourage its use in the interests of consistency and quality.
INSTRUCTIONS TO VALUER AND SUPPLY OF INFORMATION
is normal and appropriate for clients requiring frequent reports, to
appoint panel Valuers to whom standing instructions may be issued and
with whom, in some instances, a service contract may be entered into.
Model Standing Instructions can be found in the Client Focus section
of 'Professional Practice' published by the API.
for individual reports are normally provided in "writing".
Any instructions transmitted electronically should be produced in a
hard copy form for retention in the Valuer's file. Any instructions
provided verbally in the first instance should be confirmed in
"writing" by the client, or failing that, it would be
prudent for the Valuer to confirm the instructions in "writing"
and retain a file copy.
a Valuer can in due course produce a report after being provided with
very little information by the client, considerable extra time and
cost will be involved for the Valuer in ascertaining necessary
detail. Where some information is not readily available to the
Valuer, the report may be "qualified" to the extent of that
information. Where necessary information is already in the hands of
the lender, its provision to the Valuer should enhance the
reliability of the report. One of the purposes of the short form
report however, is to facilitate an expedited, cost effective
achieve these benefits, as much of the following information and
documentation as possible should be provided in or with the
instructions for a Residential Valuation and Security Assessment.
Some of the information may be obtainable by the intending borrower
from the selling agent where the property is for sale.
the name of the firm to whom the instructions are addressed.
date of request, date required (if applicable and not a contract
the name of the instructing organisation, appropriate
references and organisation contact details.
name(s) of borrowers) and any reference number(s)
- Loan Amount:
Address: full street address, locality name and postcode
- Title detail:
legal description, copy of search or title document, copy of deposited
or registered plan, strata or unit plan or survey report.
Type: eg Dwelling, unit, hobby farm
Price: if current sale involved (or price and date if recent sale).
Extracts from Copy or Copy of any special conditions,
for residential investment properties, serviced apartments and
community title, access to the contract should be arranged for the valuer.
A special fee may be appropriate for perusal of any
Estimate: if no current or recent sale is involved
- Contact for
Access: contact's name (if property has been sold or
leased, the names of any real estate or leasing agents involved should
be provided) Contact's Phone numbers and whether am or
Tenanted: Tenant's name, rent being paid and expiry date
Instructions: if any applicable
Details: if proposed dwelling, renovation or extension:
- Arrange for
the valuer to receive:
- copy of
latest tender or quote with priced schedule of fittings/pc items.
- copy of
plans and specifications preferably approved.
name and licence details
- Any other
relevant information: eg zoning certificate, development approval,
pest report, etc.
dispatch : to where and how the report should be forwarded.
WHICH SHOULD BE PROVIDED IN THE REPORT
designed to facilitate easy reading has most of the key information,
the risk analysis, valuation and assessments (and their
certification) on the first page, while supporting information, data
and comments follow. While this is primarily to facilitate easy
checking by the lender and/or trustee and mortgage insurer, it is
recommended that the whole report be read.
risk analysis on the front page with its graphic presentation
particularly serves to draw immediate attention to any risks rated
'Medium to High' or 'High', and to appropriate comments later in the
is particularly intended that the report will contain not just a
current and Market Related value assessment, but also sufficient and
appropriate information to advise the lender and/or trustee and/or
any authorised mortgage insurer of property specific and market
related risks associated with mortgage lending on the property. This
does not merely provide "point in time" information but
also forward looking advice to the client on the period of initial
the report is a pro forma report, it should present its information
in concise brief pertinent facts, points and statements rather than
detailed statements. Do not include that which is not significant to
the client and the purpose of the valuation. However, inherent and
external features that impact significantly on the property should be
report should not contain generic statements that add little real
worth to the individual report. The format has been designed to suit
a majority of situations. Where required, the "Comments"
section can be expanded to cover less common properties and "one
off” situations. While the first page is fixed in length, some
fields on the second page have the capacity to expand and create an
extra page (or more) if needed.
IN THE REPORT
to be provided in the report under each main section's
is outlined briefly below in those instances where some clarification
may be warranted. There are minor form variants for strata and
proposed dwellings/extensions/renovations, and for properties subject
to long term lease. Some label variations are available to
suitparticular situations, eg 'built about'/'year built', while
others only appear if relevant, eg 'actual rent'. A 'vacant land'
variation deletes a number of headings.
lending organisation's name. Where parties other than the lender (eg
lender's mortgage insurers and securitisers) are required to be noted
on the report, these will be inserted at the end of the document.
field labels relevant to those used by the lender.
Address, including state/territory and Postcode.
Description of parcel(s) of land.
extent and location of encumbrances or restrictions.
using convention of frontage/rear then one side/other when the
dimensions are irregular.
of zoning and name of zoning scheme/plan (LEP).
Government Area name where applicable.
type classification eg Dwelling, Residential Unit, Duplex, Vacant
sleepouts or a study if it can be used as a bedroom but at the
discretion of the valuer.
alert the lender to situations where main building is not used for
its designed purpose.
is used more often as the exact year built is often not readily
ascertainable. An alternative label "year built" is
available for selection in instances where the exact year is known.
“Circa” is a useful term for historical buildings.
to alert the lender to the possible need for an updated survey if
addition(s) made since most recent survey available to lender or its
in instances where rent is being paid and is readily ascertainable.
'Until' indicates the expiry date of the current term on the
tenancy/lease. These are inserted in the report only when applicable.
Where a lease is for a term exceeding six months, this detail should
be included. The market value assessed should reflect this lease and
the valuer should also provide a separate Vacant Possession Basis
to one decimal place. Practical use of most measuring systems will
not produce results reflecting any greater accuracy. In many
instances the nearest whole number will be realistic. Outdoor areas
include areas of open verandahs, patios, pergolas, porches, etc.
Their individual areas are aggregated for the purpose of these
brief comment as an overall rating of the ease of sale of the
property ie how saleable is the property? If it is not in keeping
with market expectations for the area, does it adversely impact on
ease of sale? How do the inherent and external features of the
property impact on its market appeal? Does it have features which
could make the property harder than average to sell?
ratings need to be explained in 'Additional Comments'. Marketability
in this instance is not intended to be a comment on the condition of
the market). Expand as necessary in 'Additional Comments'
any heritage issues, either adverse or beneficial affect the
property? Requires a 'Yes' or 'No' response. If 'Yes', further
comment required over page.
should record any aspects that currently impact on the property or
may impact periodically or infrequently. It covers matters such as
(but not limited to):
- flooding or
significant surface run off
nuisance (aircraft, road traffic, industry)
potential, or notified issues that the Valuer has become aware of,
either on the subject property or arising from neighbouring
properties, that may impact on the value or marketability of the
of these matters may warrant a report by appropriately qualified
experts or a certificate from an appropriate authority. The Valuer is
not normally an expert in these matters. The Valuer's role is to
assist in identifying issues in the first instance and to recommend
any further reports or certificates for confirmation or
clarification. (Any issues or uncertainties should be explained more
fully in 'Additional Comments').
any issues be subsequently confirmed, the Valuer should be asked for
further comment in view of any certificates or `other experts'
reports (and their estimated costs of remediation or recommended
work). Where no cause for concern is identified the Valuer may
comment "none readily apparent" or "unlikely in this
area" or similar.
significant items only, which if not attended to, could cause
significant deterioration and loss in value or could have a
significant adverse effect on marketability.
the total cost is significant, say more than $5,000, the lender will
need tc be informed as it could affect the borrower's cashfiow and
ability to meet repayments. (A more detailed list may be included in
the 'Additional Comments' section if necessary).
report is not intended as a structural or building survey report
though the Valuer may report on observed defects or other matters of
concern. 'Indicative Cost Estimate' is a guide or allowance only
pending a qualified builder's or trades person's quote.
'Existing Property' value reflects the current condition. Where there
is an 'Indicative Cost Estimate' shown for Essential Repairs, a
'Value after Repairs' can be provided immediately below the current
(To Be Erected)
will show and applies only where a building project is involved, ie a
new building. A separate heading is available for an extension or
substantial renovation. The valuation provided in each instance will
be on the basis of 'As if Complete'. In each case builder's name and
tender details should be shown.
is the Valuer's estimate of the cost of the project under contract
builder conditions. The purpose is primarily to identify if the
tender is in line with market costs and if any significant items have
not been included. It is not expected that a detailed costing will be
conducted. An overall rate per square metre check weighted for
variable factors will often be adequate for the purpose. Incentives
should be excluded. If the Check Cost is significantly different to
the tender, the possible reasons and risks should be explained in
Valuer should indicate what information has been supplied including
an indication as to whether the plans and specifications sighted have
been "Council” or relevant authority “approved".
risk analysis indicates the level of adverse impact each
stated aspect has, or (based on information that is common knowledge
and/or readily ascertainable in the market and reasonably foreseeable
events), in the near future, might have on the property's value and
marketability. Each risk rating is presented in a combined numerical
and graphical format aimed at providing a bold, clear caution
indicator to the lender. In the case of higher level ratings, it also
provides an indicator of the presence of relevant comments in the
Additional Comments' section on the following page .
Ratings under propertypro focus on four property specific aspects and
four market related aspects. Each of these aspects can involve
consideration of a range of elements relative to it. Any other
significant risks identified, which do not come under these aspects,
should also be commented upon in “Additional Comments' .
A HIGHLY TECHNICAL ANALYSIS
is not intended that the valuer would conduct a highly technical
analysis. Provided the valuer has adequate experience in the type of
property and the particular market, reliance may be placed on up to
date, broad knowledge of the dynamics of the market in which the
property is situated. Otherwise, a valuer with that experience should
supervise the valuer's work or sufficient research should be carried
out to provide an informed opinion.
OF ADVERSE IMPACT OR RISK
is accepted that each aspect is likely to have some possibility of
adverse impact or risk, however low or nominal. Therefore, low or
nominal adverse impacts or risks are rated as "1" and are
graphically depicted as a short bar.
adverse impacts or high risks are rated as "5" and are
graphically depicted as a long bar. The ratings are approximate only.
It is not intended that ratings be given other than in whole numbers
ratings which are outlined below the bar graphs are:
Low to Medium
Medium to High
Risk Ratings of 4 or 5 or the existence of three or more "3"
Risk Ratings MUST BE EXPLAINED in the "Additional Comments"
section. Ratings of "3' or below may be commented on.
the purpose of these reports, the risk rating reflects:
- the level of
adverse impact the stated aspect has upon the current value and/or
marketability of the security property, and/or
currently perceived level of adverse impact the stated aspect could
have on the value or marketability of the security property within the
initial 2 3 year period of the security .
impact in relation to a property can arise from such things as:
- where it is and
what it is near or not near
- what it is
subject to or does not have the benefit of.
- what it does
not provide but the market expects
- what defects it
- what external
controls it is subject to its micro and macro economic environment.
- the dynamics of
the local real estate market
- the specific
dynamics of its market segment
- the number of
possible factors would be extensive, so no attempt is made to list them
all here .
extent of the impact needs to be seen in terms of the local market
and the effects on marketability and value. What may cause a
significant adverse impact in one market may have low impact in
another. The extent of their individual adverse impact can vary
significantly, so no attempt is made in this memorandum to provide a
standard grading for various impacts .
AND FAVOURABLE IMPACTS OFFSET
rating adopted for each of the listed aspects requires a balanced
overview for that aspect. Properties often have many beneficial
features. Adverse impacts need to be weighed against strengths or
favourable impacts under the same aspect.
considering the aspect 'Location & Neighbourhood', a significant
adverse impact may result from being adjacent a petrol station.
However, across the road is parkland lined with Norfolk pines and
beyond that a surf beach, all of which can be seen from the subject
property. In the local market, the benefits of the latter far
outweigh the adverse impact of the petrol station and the overall
rating adopted is "2" Low to Medium .
ON HIGH INDIVIDUAL ADVERSE IMPACTS
valuer is not required to provide additional comment for overall
ratings below "4". However a comment would be warranted on
a significant adverse impact (that individually would rate "4"
or "5" but is off set by strong beneficial impacts in
the same aspect to produce an overall rating below "4") .
there can be offsets in the overall rating for an aspect heading such
as the above, there may also be cumulative effects from several
adverse impacts. For example, the location may be 10 km from the CBD,
there are no neighbourhood shops nearby and
nearby are generally old and poorly maintained. Individually these
might be rated at "2", but the cumulative effect may
warrant a rating of say "4" for the 'Location &
Neighbourhood' aspect overall .
KNOWLEDGE AND REASONABLY FORESEEABLE EVENTS
basis of any "forward looking" element of a rating is
restricted to information that is currently common knowledge and/or
readily ascertainable in the market and to events that are reasonably
foreseeable. Information which is "privileged" cannot be
reflected in the rating .
OF HIGHER LEVEL RISK RATINGS
level Risk Ratings of 4 or 5 do not necessarily mean that a property
is not suitable security, though they may influence the lenders'
decision on the amount loaned or the LVR
ratings themselves do not reflect the intended level of lending, as
this is a decision for the lender.
Risk Rating reflects an overall rating for these two aspects.
Refer to comments below in section 4 of the report for details on
'Location & Neighbourhood'.
neighbourhood is on the fringe of town, very near an area under
investigation for rezoning to industrial use and is considered likely
to result in a change of zoning to industrial. This possibility has
not had any significant impact on prices at this stage.
likelihood of a change to the neighbourhood is seen as posing a
medium to high risk of an adverse impact on the value and
marketability of the property in the next few years. 'Location &
Neighbourhood' is given a Risk Rating of 4 and must be explained in
the "Additional Comments" section.
(INCLUDING PLANNING, TITLE)
in this instance refers not only to the land physically, but also to
access, services, planning and title.
land is steep requiring a particularly steep driveway. This is
considered to have a low to medium impact on the value and
marketability of the property and 'Land' is given a Risk Rating of 2.
No comment is required but nevertheless it may be provided in the
Comments section if not already noted under 'Site Description &
aspect of the Risk Analysis covers a range of environmental issues
including contamination (refer environmental Issues heading above).
property may be in an area mildly affected by a 1:100 year flood
event that may warrant a "3" Risk Rating for the current
adverse impact on marketability and value. In addition however; a new
jet standard airport is under construction nearby and the property is
under the flight path. This alone warrants a "Medium to High"
or "4" Risk Rating. The cumulative effect of this with the
rating for the flood situation warrants a "5" rating
overall for this aspect. Comment is required.
aspect refers to all improvements, whether the main building or
ancillary improvements (and for a TBE Proposed Dwelling,
Extensions or Renovations, would include concerns about aspects of
the project or tender).
may be evidence of old, minor White ant damage that justifies a pest
report as a precaution. White ants are known to be a common problem
in the general neighbourhood. A Risk Rating of "4" may be
warranted pending a satisfactory report (requiring comment). There
would obviously be an on going risk which in itself may be rated
at "3" and may warrant a recommendation for an annual pest
A 1.8 metre high retaining wall beside an in ground pool is
badly cracked and has bowed out considerably. A neighbour's garage is
close by and could be endangered if there is a collapse. This has a
significant adverse impact on the value of the property due to the
cost to make good and the risk that it could collapse beforehand,
taking the neighbour's garage with it. Due to the potential
seriousness and urgency, a Risk Rating of "5" may be
warranted (requiring comment), and a recommendation for an engineer's
again, the improvements ray not be in keeping with the expectation
for the locality. This could increase the risk by reducing its
marketability and increasing the selling period.
market risk ratings - propro
& ASSESSMENTS SUMMARY
will normally be fee simple with vacant possession. The fee
simple indicates the nature of the interest in the property,
while the "vacant possession" reflects that the property
would transfer with that occupancy status.
if an interest in fee simple is held, a property may
subject to a long lease that could prevent vacant possession being
available until expiry. In this case a value subject to long term
lease is provided, however a vacant possession basis value is also
interest less than fee simple can be held. If so, the nature
of the interest should be stated and its effects explained in the
Additional Comments section.
report can include various valuations depending on the type of
property and the circumstances:
provision for an 'As if Complete' (see below) valuation to be
included immediately below the Existing Property 'Market Value'.
Property: showing both the land value and the added value of
improvements as components of Market Value. This presentation of
figures is suitable for any developed property (but not strata).
Further, where a significant Extension/ renovation project is involved
or significant repairs are required, there is
if Complete: for use with TBE/Proposed Dwellings primarily. “As
if Complete” is an assessment which envisages the proposed work as if
it is already complete at the date of valuation and reflecting the
current market. It does not attempt to anticipate what the market level
will be when in fact the proposed work is completed.
- For as
if complete basis valuations, the lender should request a final
inspection by the Valuer to confirm satisfactory completion and to
confirm the valuation as at the original report date (this will not
normally be an updated valuation unless specifically requested).
Land: while this report variation shows the land value, it also
provides for showing the added value of minor improvements to arrive at
title (unit title) property: for use with residential units. This
shows a single figure only as land value is not relevant to strata.
main valuation in each instance is shown in both words and figures.
possession basis value: where more than 6 months of along term
lease remains, the valuer should provide the market valuation of the
property subject to the lease. In addition a fee simple vacant
possession basis 'Market Value' should be included also.
valuations are 'point in time' assessments relevant to the date of
valuation (date of inspection). Real estate markets are dynamic and
subject to change. However, several of the aspects under the Market
Risk Ratings heading ('Reduced Value next 2 3 years.' and
'Market Volatility') should be helpful in indicating the
'sustainability' of the assessed value level.
single figure amount is recorded for the market value in line
with traditional valuation practice. The figure will normally be
arrived at after consideration of several valuation approaches such
as Sales Comparison (direct comparison) and Summation. The
Capitalisation met6hod may be used for investment property that is
subject to a long term lease. Immediately above the market value
is an apportionment of that value into its main components the value
of the land and the added value of the improvements. For strata title
(unit title) property a single value only is recorded, as an
apportionment is inappropriate.
an additional security measure, the market value is also
provided in words.
market value assessed by the Valuer relates to the market
conditions existing at the date of valuation (which will normally be
the date of inspection).
a typical marketing period in any location appears to be more than
three to four months, the Valuer should provide an estimate of the
likely marketing period necessary to achieve the assessed market
value. In such circumstances, the valuer should also provide a
statement of the dynamics of that market in the additional
Value should reflect the level of risk that would be apparent to
'knowledgeable' and 'prudent' parties. It should not include risks
that are not market knowledge. It does not attempt to predict the
the valuer is in possession of information that is not market
knowledge and it could impact adversely on the property in the
foreseeable future, the valuer should provide special comment in
'Addition Comments' provided it is not privileged information.
valuation does not reflect mortgagee In possession or other
forced sale circumstances where the realisable price under certain
market conditions is likely to be less than market value. A forced
sale value can be provided in the future should such circumstances
arise and should then be accompanied by appropriate advice reflecting
the then current market conditions and selling circumstances.
report could include other assessments depending on the type of
property and the circumstances as noted below:
value unfurnished. This reflects the most probable market rental
for the property assessed in the same condition as the property is
valued. The rental does not include rent for furniture unless:
insurance: This is an assessment of an insurable sum under
replacement and reinstatement conditions. This would normally
- a charge is
held over the items
- the charge is
sighted by the valuer
- a copy is
annexed to the report
- the valuer
makes specific note of the inclusion of furniture in additional
of alternative rental accommodation is not included. In some
instances a lender may require variations to these. Provided any
variations are recorded in the standing instructions to the Valuer
and the lender's name is recorded on the report, it should not be
necessary to specifically note the variation on the report.
current construction cost
- provision for
cost escalation during period of insurance and rebuilding process.
- allowances for
demolition and clean up
- a professional
a TBE, Extension or Renovation is involved, the assessment for
Replacement Insurance should ,include the proposed work. No
assessment is provided for a strata unit as insurance will normally
be the responsibility of the Body Corporate (owners corporation) for
the whole development.
day Sale Value: If a lender specifically requests that a value
be assessed reflecting a shorter (or longer) marketing period than
the market currently reflects, a further assessment may be provided
under 'Other Assessments'. The number of days for the restricted
marketing period should be stated. As this valuation would not likely
meet the 'after proper marketing' provision of the Market Value
definition, it should not be provided in the 'Market Value' position
(where it would reflect 'after proper marketing'). See market
this value is requested, a copy of the client's written instructions
to provide it should be retained on file.
might be noticed that no provision for a security recommendation is
included in the report. The decision as to the suitability of the
security is a commercial decision for the lender. That decision may
not only be based on the content of the report but may also extend to
factors beyond the property itself.
is not normally appropriate for the Valuer to recommend a loan to
valuation ratio (LVR) or percentage to advance. However, if a
lender specifically requires either a security recommendation or an
LVR, it could be included in the additional comments section.
DOCUMENTS TO SIGHT
recommendation should only include those certificates and documents
considered essential for the particular property to ensure the value
ascribed to it is confirmed. There should not be an "automatic"
list; only after individual consideration should they be included.
documents (whether nominated by the valuer or not), may reveal
matters not disclosed in the valuer's report. If they might impact on
the value, marketability or risk analysis, they should be
referred back to the valuer for further consideration, comment and
confirmation or otherwise of the valuation.
the report may identify or comment on various aspects to alert the
reader to various issues, it does not substitute for recommended
reports by appropriate experts, specialists or authorities.
certification relates to personal inspection of the property by the
signing valuer, carrying out of the assessments, and disclosure of
conflict of interest and financial interests.
certification also notes that the date of inspection Is also the date
report includes a standard restriction as to user and purpose. If the
report is passed to other parties, it may not be used or relied upon
by them or used for any purpose. It further notes that the report is
not a structural survey report.
Valuer will be the person who inspects the subject property and makes
the assessments. That person must be appropriately qualified and
experienced in accordance with the current requirements of the
Institute or any higher level requirements of the lender. It is not
acceptable for a valuer who has not personally inspected the property
and carried out the necessary research, enquiry and assessments, to
sign as 'valuer'. (However, a valuer who has not carried out these
tasks may authorise a report for issue see below.)
FOR ISSUE BY
is included to address instances where a director of the valuation
firm is required by the client to also sign the report. A person
signing in this capacity is merely authenticating the report as from
that firm. It should not be construed as endorsing or consigning the
would be inappropriate unless the cosignatory had, at the date of
valuation, also inspected the property and been actively involved in
the research and assessments. As a safeguard, the person authorising
may choose not t® include professional qualifications so as to avoid
giving the false impression of being a cosignatory to the valuation.
Firm ID is a unique, pre set, identifier in each copy of the
Propertypro software. The Firm ID number system could be
adopted by the lender as the identifier for that firm. If adopted
widely it would have benefits for firms in being able to quote a
consistent number for each lender.
is also made for a client allocated valuer (or firm) number to cover
instances where the client does not wish to use the preset identifier
and supplies a different number.
land – property identification
building - propro
sales evidence - propro
section appears only if selected. It provides brief comment on issues
specifically required by some mortgage securitisers and conveniently
groups them under one heading even though some will have been
addressed elsewhere in the report. Where any of the statements are
adverse, they should be further commented on in section 8 additional
on these issues are based on observations on site and where
necessary, appropriate verbal enquiries without the benefit of
searches, surveys, etc. The valuer reserves the right to review the
valuation and the report if the lender's searches and enquiries
reveal contrary conditions or any matters not addressed therein.
section appears only if it contains information. If the instructing
Organisation/lender requires the report to nominate additional
parties who may rely on the report, they can be stated in this
CLARIFICATION AMENDED REPORT
parties entitled to rely on a report are unclear on any aspect of its
content, or consider that inadequate information has been provided,
the valuer should be contacted before acting on the report. If
additional information is supplied to clarify or enhance the report,
an amended report should be issued with a note that the original
report is withdrawn and should be returned to the valuer. There
should be no additional fee unless the valuer was incorrectly
instructed in the first instance.
report should be accompanied by a coloured photograph of the front
(or other appropriate) elevation of the property unless the Client
directs that one is not required (in which case a photo should be
taken and retained on file or electronically stored).
significant adverse features are apparent it may be appropriate to
provide additional photos showing relevant detail. These may include
features nearby which impact on the property.
THE VALUER MAY PROVIDE RESTRICTED COMMENT ON
REQUIRING SPECIALISTS REPORTS
Valuer's report may provide restricted or limited comment on a range
of matters primarily to draw attention to aspects that may require
action by others before confirmation of the report by the valuer.
These tend to be in specialist areas where the Valuer often will have
some knowledge but in which the Valuer is either not an expert or is
not permitted under some act or regulation, to express a definitive
opinion. The comments could note some observed condition or
indication of a possible problem area and could lead to
recommendations for reports from such experts as:
• geo technical
bodies and authorities.
INITIAL COMMENTS INDICATIVE ONLY
Valuer's comments should be taken as indicative only and not
definitive on the particular matter. For example, the Valuer's
inspection may note that the building appears to be too close to what
appears to be the boundary. The Valuer's report may then note this
and recommend that a surveyor's report be obtained. In this way the
Valuer serves to highlight need for a particular action. Any
valuation or risk assessment provided will normally be subject to
such reports being satisfactory.
BACK TO VALUER
the specialist's report has been obtained, it should be referred back
to the Valuer for comment as to how it impacts on the valuation, the
risk analysis or the marketability of the property.
circumstances arise which the valuer considers warrant departure from
the provisions of this Supporting Memorandum, the reason for the
departure should be clearly stated in additional comments. The
lender should be adequately advised of the possible impact of such
action on the assessments and the report contents.
TO BE CHECKED BY LENDER AND/OR ITS SOLICITOR
BACK TO VALUER
of the information provided in the report may be obtained by
expedient means or from sources with no evidentiary value, rather
than applying, paying and awaiting receipt of appropriate official
documentation such as a solicitor would request in carrying out a
conveyance or creating a mortgage.
is not only to expedite the Valuer's process, but also to reduce
duplication and save extra expense. Sometimes a report will provide
information, which documentation or certificates subsequently
obtained by the lender or its solicitor reveal to be either incorrect
or incomplete or not commented upon at all in the report. When any of
these occurrences is
by subsequent checking, it would be appropriate to refer the matter
back to the Valuer for further comment and advice as to how it
affects the valuation and security assessment.
OR SOLICITOR TO CHECK
reported in the Valuation and Security Assessment Report which the
Valuer assumes the lender and/or its solicitor will confirm or
ascertain by checking appropriate documentation or certificates
details including restrictions and
- zoning or
arising from the numerous searches a solicitor may conduct including,
where relevant, searches of body corporate records and amounts held in
arising from any certificates or documents that the report specifically
recommends are obtained.
THE VALUER COULD BE EXPECTED TO HOLD ON FILE
FILE SHOULD CONTAIN
Valuer's file for any valuation report using the PropertyPro
"Residential Valuation and Security Assessment" Pro forma
could be expected as a good practice to contain:
- copy of
- copy of the
- copy of any
documents provided by the client, its solicitor or the borrower.
- copy of any
block, subdivision or strata plans relied upon.
- copy of
valuer's inspection notes for the subject property including:
- a plan of
the main buildings, (preferably drawn to scale using graph paper)
showing external and internal walls and recording external wall
dimensions. While the plan could also show approximate positions of
door and window openings, positions of fixed cupboards, PC items and
special fittings, the valuer's recording system may use other
appropriate means of recording this detail. (Where a floor plan is
provided, the Valuer should conduct sufficient check measurements and
observations to verify that the building has been built to plan, or if
not, what variations have occurred. Variations should be noted in the
report. If the building plan states areas, it would be appropriate for
the valuer to check these by calculation). Building areas required in
the report are to be based on measurement and calculation.
notes to record any necessary detail beyond that required in the
report covering construction of the main building, its quality,
finishes, condition and any essential repairs,
notes of ancillary improvements.
of Valuer's inquiry sheet if appropriate adequately recording any
additional research information obtained and preferably from whom
- print of photo
(or photocopy of original),
- copy of
Valuer's work sheet referencing the sales data relied upon, any
adjustments or calculations made and reconciliation of the methods of
valuation used in carrying out the assessment(s). Where a
TBE/Extension/Renovation is involved, calculations for the Check
Costing should also be on file.
- copy of any
special document relied on that the Valuer considers relates to
the property specifically rather than properties in general.
NOTES ON PROPERTYPRO
any notes are recorded on tape or by other electronic means, either
the tape should be retained with the file or a hard copy of the
recording or electronic record should be produced and retained with
the file. While
valuers may use a variety of methods to record their field notes, as
a guide, information recorded and retained on file should be
- to demonstrate
that a proper inspection has been carried out.
- to allow the
valuer to discuss the property and the report with the client or its
service providers at some point in the future (which may be some years
property pro sample