Alternative Use Value (AUV) meaning

In practice, Alternative Use Value (AUV) is the value of land or buildings assessed on the basis of a different use that has a realistic (i.e. reasonable) prospect of securing planning permission. It is not a statutory term but a widely used valuation and planning expression, recognised in professional guidance (including RICS materials), and applied across England & Wales, Scotland, Northern Ireland and Ireland with broadly consistent meaning. Key features: - It differs from Existing Use Value (EUV): AUV reflects the most credible alternative use, supported by planning policy, evidence and market demand. - It may incorporate probability-weighting for planning prospects and delivery risks, but is distinct from generic “hope value”, which reflects less certain potential. - It is commonly used in development appraisals, secured lending, land disposals, charity compliance, viability negotiations and compulsory purchase compensation, where statutes require market value to reflect planning prospects (subject to the jurisdiction’s planning assumptions). Assessment focuses on the planning position (policy, allocations, fallback, precedent), site constraints, title, abnormal costs and comparable evidence. In the social housing context, “AUV (social housing)” is a specific RICS-recognised basis for valuing stock on an alternative-use assumption where permitted.