PropertyPro 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. The guidance notes cover extremely well and in detail the preparation and deliverance of the report to a residential mortgagee.
The guidance notes are for the guidance of mortgage clients and related third parties who rely on such reports, to acquaint them with:
Valuers 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.
The Institute recommends that lenders only request Valuers to provide more comprehensive reports:
The 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.

It 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.
Instructions 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.
While 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 report.

To 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. substantial extra documentation.
Layout 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.
The 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 report.

It 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 exposure.

As 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 noted.
The 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.

Information to be provided in the report under each main section's sub headings 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.

The 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.

Provide field labels relevant to those used by the lender.

Street Address, including state/territory and Postcode.
Legal Description of parcel(s) of land.
Type, extent and location of encumbrances or restrictions.
Shown using convention of frontage/rear then one side/other when the dimensions are irregular.
Status of zoning and name of zoning scheme/plan (LEP).
Local Government Area name where applicable.

Broad type classification eg Dwelling, Residential Unit, Duplex, Vacant Land, Other.

Include sleepouts or a study if it can be used as a bedroom but at the discretion of the valuer.

Include ensuites.

To alert the lender to situations where main building is not used for its designed purpose.

"About" 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.

Aims 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 solicitor.

Noted 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 value.


Rounded 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 reports.

A 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?

Low 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'

Do any heritage issues, either adverse or beneficial affect the property? Requires a 'Yes' or 'No' response. If 'Yes', further comment required over page.

This 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):
Observed, 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 subject property.

Any 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').

Should 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.

List 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.

Where 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).
The 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.
The '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 'Market Value'.

TBE (To Be Erected)
TBE 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.

This 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 "Additional Comments".

The 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".

The 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 .

Risk 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' .

It 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.

It 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.

High 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 .

The ratings which are outlined below the bar graphs are:
"1 "   Low
"2"   Low to Medium
"3"   Medium
"4"   Medium to High
"5"   High.

Any 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.

For the purpose of these reports, the risk rating reflects:
Adverse impact in relation to a property can arise from such things as:
The 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 .

The 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.

When 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 .

The 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") .


While 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
properties 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 .

The 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 .

Higher 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

The ratings themselves do not reflect the intended level of lending, as this is a decision for the lender.

This 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'.

The 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.

The 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.

Land in this instance refers not only to the land physically, but also to access, services, planning and title.

The 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 & Access'.

This aspect of the Risk Analysis covers a range of environmental issues including contamination (refer environmental Issues heading above).

A 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.

This 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).

There 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 inspection report.

EXAMPLE: 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 report.
Yet 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.
See market risk ratings - propro
This 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.
Even if an interest in fee simple is held, a property may be 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 provided.
An 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.

The report can include various valuations depending on the type of property and the circumstances: also provision for an 'As if Complete' (see below) valuation to be included immediately below the Existing Property 'Market Value'. The main valuation in each instance is shown in both words and figures.
The 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.

A 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.
As an additional security measure, the market value is also provided in words.
The 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).
If 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 comments section.
Market 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 future.
If 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.
The 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.
See chattels (inclusions)
The report could include other assessments depending on the type of property and the circumstances as noted below:
Rental 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: Replacement insurance: This is an assessment of an insurable sum under replacement and reinstatement conditions. This would normally include: Cost 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.
Where 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.
x”' 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 value above.
Where this value is requested, a copy of the client's written instructions to provide it should be retained on file.

It 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.

It 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.

The 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.
Some 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.
While 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.

The 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.

The certification also notes that the date of inspection Is also the date of valuation.

The 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.

The 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.)

This 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 valuation.
This 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.

The 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.

Provision 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.

See land – property identification

See building - propro

see ancillary improvements

See sales evidence - propro


This 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 comments.
Statements 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.

This 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 section.
If 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.

The 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).

Where 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'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:
pest controllers
land surveyors
geo technical engineers
structural engineers
building inspectors
environmental surveyors
town planners
regulatory bodies and authorities.

The 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.

When 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.

When 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.

Some 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.

This 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
discovered 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.

Matters 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 include:
A 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:

Where 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 adequate:
See property pro sample