Property valuation
Property Valuation for Bank Lending and Mortgages in Kenya
When land or a building is offered as security for a loan, the lender needs an independent view of what it is worth and what it could be sold for if the loan is not repaid. We prepare that valuation for banks, SACCOs and other lenders, whether the lender instructs us directly or the borrower arranges it at the lender's request.
Values we report
- Market value: the price the property would reasonably fetch between a willing buyer and a willing seller after proper marketing.
- Forced-sale value: what it would realise if it had to be sold within a short period, without the usual marketing time. It is lower than market value, and lenders use it to judge what they could recover.
- Insurance reinstatement value, where the lender requires the building to be insured for the cost of rebuilding it.
What the valuer checks
- The title and official search, compared with what is on the ground.
- Access, boundaries and beacons, and any encroachment.
- Planning use and zoning, and approvals for the buildings on the land.
- Construction, condition, age and services.
- Comparable sales and rents, and anything likely to affect how easily the property would sell.
What the report contains
- Property description, location and tenure, with title particulars as searched.
- Site and building measurements, with the measurement standard used; construction, condition and services.
- Planning and zoning observations, market commentary and comparable evidence.
- The valuation approach and why it fits the property; market value, forced-sale value and, where required, reinstatement value.
- Assumptions, special assumptions and limiting conditions, with photographs.
- The signature and registration details of the registered valuer.
How an instruction runs
- We confirm the lender, the purpose and the scope, and send a fee quotation based on the statutory scale.
- A valuer inspects the property and checks the documents.
- We analyse the market evidence and prepare the report in the lender's required format.
- The signed report goes to the lender, and we answer any questions on it.
Questions
Why is the forced-sale value lower than the market value?
Forced-sale value assumes the property must be sold within a short period, without the usual marketing time. Lenders use it to judge what they could recover if a loan is not repaid.
Can my bank use a valuation I commissioned myself?
Many lenders accept reports only from valuers on their own panel, addressed to the bank. Check with your lender first, or ask the lender to instruct us directly.
How long does a valuation remain acceptable to a lender?
A valuation is given at a stated date. How long a lender will rely on it is set by the lender's own policy.
What happens if the title details and the ground do not match?
We report the discrepancy, for example a difference in area or a building across a boundary, and explain how it affects the valuation. The lender then decides how to proceed, often after the owner has it corrected.
Other valuation purposes
- Financial reportingFair values and revaluations for company accounts and audits.
- Insurance & reinstatementWhat it would cost to rebuild, so buildings are insured correctly.
- Compulsory acquisitionIndependent advice on just compensation when land is acquired.
- Litigation & disputesIndependent valuations and expert evidence for courts and settlements.
- Estates & probateValues for succession proceedings and a fair distribution.
- Sale, purchase & lettingMarket value or market rent before you buy, sell or let.
- Rental, statutory & internalMarket rent, rating, stamp duty, tax and internal purposes.
Have a Property Valuation Requirement?
Whether you require a valuation for lending, investment, financial reporting, insurance or another purpose, our team can help establish the appropriate scope of work.