Desktop valuation
What is a desktop valuation, and when will a lender rely on one?
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BY MICHAEL SHANG · SIXTEEN YEARS IN COMMERCIAL BANKING · UPDATED
// THE SHORT ANSWER
A desktop valuation is an estimate of a property's value made without an inspection, either by a valuer working from sales evidence, title and records, or by an automated valuation model. A kerbside or drive-by valuation adds a look from the street; a full valuation adds an inspection inside. Lenders usually confine desktop figures, by policy, to lower loan-to-value lending on ordinary residential property, to top-ups and to portfolio revaluations, because the method cannot see condition, defects or anything unusual about the building. Commercial, rural and development security is usually valued in full.
BASIS Practitioner judgment from sixteen years in commercial banking, set out in How Bankers Think (Highbank Press, 2026). Every borrower on this site is a composite constructed for teaching, not a client. The market is mid-market commercial lending as practised in New Zealand and Australia; where a convention differs elsewhere, the page says so.
// WORKED IN
// NEXT TO IT
- Personal guarantee release
- General security agreement (GSA)
- Subordination
- Intercreditor agreement
- Loan to value ratio (LVR)
- Forced-sale value
- PPSR (Personal Property Securities Register)
- Retention of title
- Purchase money security interest (PMSI)
- Preferential creditors
- Letter of comfort
- Cross-guarantee
- Floating charge
- Structural subordination
- Recovery waterfall
- First mortgage
- Pari passu
- Loan to security ratio (LSR)
- Lending value
- All-monies clause
- Valuation reliance letter
- Solicitor's undertaking
- Loss payee (bank's interest noted)
- Liquidation value (orderly and forced)
- Water entitlements (as security)
- Livestock as security
- Specific security agreement (SSA)
- Debenture (security document)
- Share pledge (share charge)
- Step-in rights
- Third-party mortgage
- Limited guarantee
- Upstream guarantee
- Corporate benefit
- Financial assistance (whitewash)
- Deed of priority
- Perfection (security interest)
- Title insurance
- Payout figure (redemption statement)
- Independent legal advice certificate
- Panel valuer
- Partial release (of security)
- Security trustee (security agent)
- Cash cover (cash-collateralised facility)
- Back-to-back loan
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