Posted February 6, 2020

Lender confirms breakthrough change to their valuation process


One of our specialist finance lenders has recently amended their approach to valuing various buy-to-let properties.

Now, any house in multiple occupancy (HMO) with 7 or more rooms will be valued on an investment value basis. This valuation process is also true for a multi-unit freehold blocks (MUFB’s) where they cannot aggregate the value of the individual units.

For houses in multiple occupancy of 7 or 8 rooms, the lending approach has changed from bricks and mortar to the investment value of the property. For houses with over 9 rooms, the lending process has adjusted from the lower end of the investment value or vacant possession to the investment value.

For multi-unit freehold blocks where the units are not individually sellable, the lending approach has changed to provide either investment value or aggregate value of the units if individually sellable.

To be individually sellable, each unit must:

  • Be fully self-contained
  • Be more than 30sqms
  • Have its own utility services
  • Not sold off on an LLH title
  • Have enough demand to be sold on an owner-occupier basis (as confirmed by the valuer)

What does this mean for our clients?
The change to the valuation process provides clarity and offers our clients an exciting opportunity. By providing potentially higher valuations, our clients can borrow more money for HMO and MUFBs projects.

Are there any other qualifying criteria?

The short answer is no. Our lender can assist you with your enquiry without the need for further information.

As with any HMO or MUFB project, you will need to be able to meet all the normal underwriting processes, including licensing, building regulations and planning.

In addition, the valuer as part of his report will confirm demand for the property and be expected to support the investment value with evidence. These factors are nothing new and work as part of the lending process as normal.

With Finance 4 Business at your specialist financial broker, we will provide you with access to this specialist lender as well as support you with the underwriting process by finding the right financial solutions for you and your needs. Find out more by calling 0121 309 0444 or emailing