Understanding residential, commercial and agricultural valuations.
A property valuation is one of the most important steps in securing finance. Whether you're buying, refinancing, developing, or releasing equity, the lender needs an independent assessment of the property’s value and suitability as loan security.
But not all valuations work the same way. Residential, commercial and agricultural valuations each have unique processes, costs, timelines and risk considerations — and borrowers are often surprised by how different they can be.
At Lumo, we help clients understand what type of valuation applies to their property, who pays for it, and how it impacts lending outcomes.
Residential valuations
Residential valuations are the most common and typically the simplest. These apply to:
Houses
Townhouses
Apartments
Small-unit complexes
Residential land
Who pays for it?
For most standard home loans, the lender covers the valuation cost.
Some exceptions apply (e.g., unusual properties, rural residential, or when multiple valuations are needed), but the vast majority of residential borrowers never see a bill.
Types of residential valuations
Automated Valuation Model (AVM) – computer-generated, no inspection
Desktop valuation – data review without physical access
Kerbside/drive-by – external inspection only
Full valuation – valuer inspects inside and out; most reliable
The lender chooses the type based on risk, location, loan size and property complexity — not the borrower.
How long do they take?
AVM or desktop: minutes to hours
Kerbside: 1–2 days
Full valuation: 2–5 business days (sometimes faster depending on valuer availability)
Residential valuations are generally straightforward because comparable sales are plentiful, and the valuation methodologies are well-established.
Commercial property valuations
Commercial valuations are more complex because the properties vary widely and the value depends not only on the physical asset but also the income it generates.
Commercial properties include:
Warehouses
Offices
Retail shops
Industrial sites
Mixed-use zones
Childcare centres
Medical suites
Commercial developments
Who pays for it?
The borrower almost always pays for commercial valuations.
This is standard industry practice.
Costs generally range from:
$2,000 to $5,000 for straightforward commercial properties
Higher for complex assets, multi-tenancy buildings, development sites or regional properties
The lender orders the valuation through their panel, but the customer pays the fee upfront.
How commercial valuations are assessed
Commercial valuers rely on:
Current market rent
Lease terms, vacancy rates and tenant quality
Capitalisation (cap) rates
Comparable sales
Zoning and permitted uses
Condition of the building
Future redevelopment potential
Commercial valuations can impact:
Maximum loan-to-value ratio (LVR)
Lending structure (full-doc vs lease-doc vs low-doc)
Interest rates
Loan terms
How long they take
Commercial valuations typically take 5–10 business days, depending on:
Property type
Availability of lease documents
Access arrangements
Complexity of income analysis
Agricultural (agri) valuations
Agricultural lending is a specialised space. Rural properties are diverse, and valuation requires expertise far beyond standard residential or commercial work.
Agri properties include:
Farms (cattle, cropping, sugarcane, mixed-use)
Hobby farms
Grazing land
Intensive agriculture sites (piggeries, poultry, feedlots)
High-value water or irrigation properties
Regional landholdings with multiple titles
Who pays for it?
The borrower pays for agricultural valuations, similar to commercial.
Costs vary significantly because agri valuations require:
Specialist valuers
Larger land areas
More complex assessments
You might expect a range from $3,000 to $10,000+, depending on:
Size
Location
Number of parcels
Water rights
Productivity profile
Infrastructure on the property
What agri valuers assess
Agri valuations consider both land value and productivity value, including:
Soil quality and carrying capacity
Pasture health
Water rights, licenses and reliability
Improvements: fencing, sheds, irrigation, bores, dams
Environmental overlays and restrictions
Stock capacity
Comparable rural sales (which are less frequent than residential)
In some cases, historical production and yield data
Because of this complexity, agri valuations are one of the most detailed in the property industry.
How long they take
Agricultural valuations commonly take:
10–15 business days
Longer if multiple titles or remote locations are involved
Why valuation type matters for your loan
The valuation directly affects:
Borrowing capacity
LVR limits
Acceptable loan products
Equity release options
Interest rate tiers
Policy eligibility
Different property classes have different risk profiles, so lenders adjust their policies accordingly.
For example:
Commercial loans often have LVR caps around 60–70%.
Agri loans vary but often range 50–70%, depending on property use and lender appetite.
Residential loans can go up to 95%+ with LMI, or lower with no LMI.
Choosing the right lender is about matching your property type to the lender that best understands it.
Let’s chat.
Whether you're buying a home, purchasing a commercial site, or arranging finance for rural or agricultural land, we can guide you through the valuation process, expected costs and timelines — and help select the right lender for your property type. Let’s chat.
This page provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances and your full financial situation will need to be reviewed prior to acceptance of any offer or product. It does not constitute legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances. Subject to lenders terms and conditions, fees and charges and eligibility criteria apply.