If you’ve been sent a valuation report for a development site or a project that’s still under construction, you may have noticed two very different figures sitting in the same document — one described as “as is” and another as “as if complete.” They can be tens or even hundreds of thousands of dollars apart, and that gap sometimes causes genuine confusion, or worse, disputes with lenders and JV partners who assumed everyone was talking about the same number.
A residential development valuation isn’t a single figure the way a straightforward house valuation often is. Because the property is either raw land, a partly built site, or a project on paper, a valuer typically has to answer two separate questions: what is it worth right now, in its current state, and what would it be worth once the plans are actually built? Those are the “as is” and “as if complete” bases of assessment, and mixing them up — or not understanding which one your bank is relying on — can cause real problems with finance approvals, drawdowns and project budgeting.
This article explains what each basis actually means, why lenders and valuers use both, how the figures are calculated, and what property owners, developers and investors should watch out for when reading a development valuation report.
Summary
An “as is” valuation values a development site exactly as it stands on the inspection date — vacant land, a knock-down house, or a partially completed building — with no assumption that anything further will be built. An “as-if-complete” valuation (sometimes written “as if complete” or “on completion”) assumes the proposed development has been fully built in accordance with the approved plans, specifications and permits, and values the finished product at current market conditions.
Lenders typically want both figures for construction and development finance, because the “as is” value tells them what security they hold today, while the “as if complete” value (usually combined with a cost-to-complete assessment) tells them what the project will be worth once their money has been spent building it. The gap between the two is where a lender’s risk sits, which is why construction loans are drawn down in stages rather than paid out as one lump sum.
Key things to take away:
- Neither figure is “the” value of the property — they answer different questions for different purposes.
- The “as-if-complete” figure assumes satisfactory completion; it does not guarantee the project will actually reach that value if plans change, costs blow out, or the market moves.
- Valuers rely heavily on the accuracy of plans, specifications, and cost estimates provided to them — poor quality documentation leads to a poor quality “as-if-complete” opinion.
- If you’re a developer, an owner refinancing mid-project, or a party in a dispute (family law, deceased estate, JV breakdown), it’s worth confirming with your valuer or broker exactly which basis has been used and why, before relying on the number.
What Is a Residential Development Valuation?
A residential development valuation is an assessment of a property’s value where the highest and best use involves building, or completing the build of, residential dwellings — anything from a single knock-down-rebuild block in the suburbs to a multi-lot subdivision or a boutique apartment block. Unlike a standard house valuation, where the valuer is comparing one finished home to other finished homes that have recently sold, a development valuation usually has to account for a property that either doesn’t exist yet in its final form, or is only part-built.
Because of that, Australian valuers working on these assignments are usually asked to report on more than one basis of value in the same report. The two most common are “as is” and “as if complete,” and understanding the difference is central to understanding the whole report.
Why the Distinction Matters in Practice
Say you own a block of land in outer Melbourne with a development approval (DA) for six townhouses. A bank considering funding the build wants to know two things: what’s the land worth right now if the project fell over tomorrow (their fallback security), and what will the finished townhouses be worth once they’re built and can be sold or rented out (their exit position). Those are genuinely different numbers, calculated using different evidence and different methods, and a valuer needs to be clear about which one they’re providing at each stage of the report.
“As Is” Valuation: Value in Current Condition
An “as is” valuation values the property exactly as it stands on the date of inspection — nothing more, nothing less. If the site is vacant land, that’s what’s valued. If there’s an old fibro cottage sitting on a block earmarked for demolition, the valuer values the land and improvements in their current, unimproved-for-development state (sometimes noting the existing dwelling adds little or nothing to value once demolition costs are factored in). If construction is 40% complete, the valuer assesses the value of the land plus whatever’s been built so far.
Typical inputs a valuer uses for an “as is” assessment include:
- Recent comparable sales of similar land or partly-built sites in the area.
- The property’s zoning and any approved DA, since unused development potential can add value even before a shovel goes in the ground.
- Existing improvements and their contribution (or lack of it) to value.
- Site conditions — contamination, easements, flood overlays, heritage listings, and similar constraints that a straightforward house valuation might not need to weigh as heavily.
An “as is” figure is the one most relevant if a lender needs to know what they could realistically recover by selling the security today, without relying on the project being finished.
“As-If-Complete” Valuation: Value Once the Project Is Built
An “as-if-complete” valuation makes a specific hypothetical assumption: that the proposed dwellings have been constructed in full accordance with the approved plans, specifications, and any relevant permits, and that all statutory requirements (occupation certificates, final council sign-off, and so on) have been satisfied. The valuer then assesses what that finished product would be worth if sold on the open market, using current market evidence — not evidence from whenever the project happens to actually finish.
This basis relies heavily on the documentation the valuer is given, including:
- Architectural and engineering plans and specifications.
- A schedule of finishes (tiles, fittings, inclusions — the difference between a project home finish and a high-end fit-out can move the “as-if-complete” figure substantially).
- Council-approved DA or complying development certificate (CDC) conditions.
- Sometimes a quantity surveyor’s cost report, which the valuer uses to sanity-check whether the proposed budget is realistic for the finish level described.
It’s worth being clear about what “as-if-complete” does not mean. It’s not a forecast of what the market will look like in eighteen months’ time when the project is actually finished — it’s a present-day opinion of value, assuming (hypothetically) that the building already exists today. If the market moves, up or down, between the valuation date and practical completion, the actual sale prices achieved can differ from what was assessed. It’s also not a guarantee: it assumes the builder actually delivers what’s in the plans, on budget, and that no material variations creep in along the way.
Why Lenders Ask for Both
For construction and development finance, banks and non-bank lenders almost always want both figures, because they’re managing risk at two different points in time.
| Basis | Answers the question | Mainly used for |
| As Is | What is the security worth right now? | Initial loan-to-value ratio (LVR), fallback position if the project stalls |
| As-If-Complete | What will the security be worth once built? | Confirming the end value supports the total debt, calculating “on completion” LVR |
A lender typically won’t release the full construction facility upfront. Instead, funds are drawn down in stages as building work progresses — slab, frame, lock-up, fit-out, completion — with a valuer or quantity surveyor often checking progress against the budget at each stage. The “as-if-complete” figure, combined with the cost-to-complete, helps the lender check that the numbers still stack up: if construction costs blow out significantly, the margin between total debt and the completed value can shrink, which is exactly the scenario a lender wants flagged early rather than discovered at settlement.
This is also why “as-if-complete” valuations are almost always qualified. You’ll typically see wording along the lines of the valuation being subject to satisfactory completion in accordance with the plans and specifications provided, and the valuer reserving the right to review the figure if the scope, plans or market conditions change materially before completion, including situations involving valuation changes during the development finance process.
Common Misconceptions
“The as-if-complete figure is what I’ll definitely sell for.”
It’s a present-day opinion based on current comparable sales, assuming the build goes to plan. It’s not a sale price guarantee, and it doesn’t account for future market movements, marketing strategy, or how the finished product is actually presented and sold.
“A higher as-if-complete value means I can borrow more straight away.”
Lenders lend against a blend of both figures and their own risk appetite (LVR limits, presale requirements for larger projects, serviceability), not the as-if-complete number in isolation.
“As is and as if complete are just two names for the same thing.”
They’re deliberately different bases of assessment, calculated with different evidence, and conflating them is one of the more common reasons finance applications get held up while a valuer or broker clarifies exactly what’s being reported.
“Once I get the DA approved, the as-if-complete value is locked in.”
Plans can change during construction (variations, substitutions of finishes, engineering changes), and any material change can mean the original as-if-complete assessment no longer applies without a review.
When You Might Need These Valuations Outside of Bank Finance
While construction lending is the most common trigger, “as is” and “as-if-complete” assessments also come up in:
- Family law property settlements involving a part-built home or a development site, where both parties (and the Court) need to understand current value versus completed value.
- Deceased estates where a property was mid-development at the time of death, and executors need clarity on value for probate or distribution purposes.
- Joint venture or partnership disputes, where the parties disagree on what a stalled or partly-built project is actually worth.
- Capital gains tax and stamp duty considerations, may require evidence of market valuations for tax purposes in certain circumstances, depending on the transaction and applicable requirements. (this is a specialist area — always get tailored tax advice from your accountant, since CGT and stamp duty treatment of development sites can be genuinely complex and varies with the facts).
In these situations, an independent valuation — one commissioned by the parties or the Court rather than by a single lender — can be useful precisely because it isn’t tied to any one party’s finance application, and can be scoped to answer the specific question at hand (current condition, completed value, or both).
Frequently Asked Questions
Does every development valuation include both an “as is” and “as-if-complete” figure?
Not necessarily. It depends on what the report is for. A straightforward land valuation for a vacant block might only need an “as is” figure, while a construction loan application will usually need both.
Who decides which basis of valuation is used?
The instructing party — usually the lender, solicitor, or accountant commissioning the report — sets out the scope and basis required. The valuer will confirm this in the report and flag if the instructions are unclear or if additional information is needed to complete the assessment properly.
What happens if the actual build doesn’t match the plans used for the as-if-complete valuation?
If there are material changes to the scope, finishes, or specifications, the original as-if-complete figure may no longer be reliable, and lenders will often require an updated valuation before releasing further funds.
Can I use an as-if-complete valuation to sell off the plan?
Off-the-plan sales are usually priced by the developer based on market research and sales strategy, not directly from a bank valuation. That said, a valuer’s as-if-complete assessment can be a useful independent sense-check on whether asking prices are realistic.
Is a quantity surveyor’s report the same as an as-if-complete valuation?
No. A quantity surveyor typically assesses construction costs and progress claims. A valuer assesses market value. Lenders often use both together — the QS confirms costs are on track, while the valuer confirms the end value still supports the loan.
Does the “as is” value include the cost of demolishing an existing house?
It depends on the instructions and the specific property, but valuers will typically factor in demolition costs where relevant when assessing the current, as-is value of a site earmarked for redevelopment.
Conclusion
“As is” and “as-if-complete” answer two different questions: what a development property is worth right now, and what it will be worth once built to the approved plans. Lenders use both to manage risk through the life of a construction loan, and the figures aren’t interchangeable. If you’re relying on a development valuation for finance, a settlement, or a dispute, it’s worth confirming which basis applies to which figure before making decisions based on it.
Need a Development Valuation Explained or Assessed?
If you’ve received a development valuation report and want an independent read on what the “as is” and “as-if-complete” figures actually mean for your situation — or you need a new valuation for finance, a family law matter, or an estate — AC Valuers can help talk through the scope and prepare a report suited to your purpose. You can reach AC Valuers on (02) 9666 1488 to discuss what you need.
