AVM – What is it and why is it so important now?

27 April 2020

Automated Valuation Model (AVM) is the process many lenders use to value a property remotely. Why is it so important now? Well, with the introduction of social distancing obtaining the valuation has become the stage at which many mortgage applications have fallen down. 

AVM is used by pretty much all high street banks and lenders. The technology uses previous surveyor valuations, historical house price movements together with user inputs like the number of bedrooms, property improvements, etc. to produce a valuation without having to physically visit the property. 

There’s nothing particularly new or innovative about this process, it’s just something we, brokers and clients, have taken for granted in the past. Whether the valuation has been done using AVM or by a surveyor physically visiting a home or site has been, on the whole, irrelevant. However, at this present time, it’s THE most important aspect to the success of an application.

There will always be exceptions to the rule. Properties that will require further investigation, sites that are difficult to assess or perhaps don’t have enough historical detail to generate a satisfactory AVM valuation. So it’s by no means the answer to all the setbacks we may face at the moment but it is a viable option for some residential bridging lenders at the present time. 

We understand that everyone wants to move forward with their lives and their businesses and if you are in the position to do so why wait? There are lenders in the market that are utilising AVM to keep things moving and keep businesses on track. We are constantly searching the market for new and relevant products for our clients and have found a number of residential bridging products that do not require a physical valuation. 

If you’d like to speak to the team about residential bridging options currently available please don’t hesitate to call Steven on 07908 622 355, email: steven@peritus-group.co.uk or Michelle on 07739 797 687, email michelle@peritus-group.co.uk