The valuer is sometimes called upon to determine the value of land subject to a proposed development for lending purposes. This is referred to as a "to be erected" (TBE) valuation. It is usually carried out by reference to the plans and specifications of the proposed building or additions. If the available data is inadequate, the valuer should qualify the report as being subject to the proposal meeting certain minimum standards. Provision can be made in the mortgage deed for the incorporation of the valuer's requirements or conditions. For large proposals, the valuer will have to work in conjunction with other experts such as structural engineers, builders, architects or quantity surveyors. The valuation should be subject to satisfactory certirIcates of compliance and completion from the local council and supervising architect.

The API Standard (1993) makes the following important comments in relation to the valuation of a proposed dwelling:


6.1 Valuers may provide, on request from a lender, a valuation of a proposed dwelling on a completed basis. Instructions from lenders to value dwellings to be erected should include:
(i) a copy of the builder's quotation, including the builder's licence number, contract or tender or, in the case of an owner builder, a schedule of costs on a trade by trade basis and the owner builder's licence number;
(ii) a copy of the set of council approved and stamped plans and specifications, however, these may be sighted prior to completion if not available at the time of instruction;
(iii) engineer's details of the proposed building for concrete slab floors and other structural elements as applicable.

6.2 Where either, all or some of the plans, specifications, documents, etc referred to in paragraph 6.1 are not made available to the Valuer, the Valuer should draw this/these fact(s) to the attention of the lender and, in certain circumstances, may consider it more appropriate to decline to express an opinion.

6.3 In undertaking a valuation of a property on which the dwelling is to be erected, the Valuer should not hold him/herself out as having qualifications in a building/structural discipline unless he/she does have such qualifications.

6.4 In the event that a Valuer is not so qualified as referred to in paragraph 6.3, he/she should recommend and advise the mortgagee that an assessment of costs or comment on any departures from acceptable standards of construction and/or relevant Australian construction standards be provided by another suitably qualified person, eg engineer, architect, quantity surveyor.

6.5 If the Valuer in the valuation exercise has appropriate costing expertise and cost records, he/she should carry out a check costing based on details in the builder's tender, the plan and specification and advise the mortgagee of any significant difference between the costing and the builder's tender and any possible reasons therefore.

6.6 The Valuer should assess the on completion market value of the property as at the date of the valuation report and having regard to the matters referred to in paragraphs 1.1,1.2,1.3,2.1 and, where applicable, 4 of these guidelines. The valuation should be, inter alia, subject to:
(i) satisfactory completion of the dwelling in accordance with the matters referred to in paragraphs 6.1 of these guidelines;
(ii) an inspection by the Valuer following practical completion of construction;
(iii) confirmation of the value following inspection after practical completion;
(iv) issue of all relevant approvals including a satisfactory building compliance certificate under the relevant legislation (if applicable);
(v) sighting of any other reports from other experts who have provided advice in respect of the construction of the dwelling;
(vi) such other matters/issues that the Valuer is of the opinion should be drawn to the attention of the lender.