What Does GDV Mean In Property?

If you’re like me then you’ve probably heard the term GDV somewhere for the first time and thought what the hell does that mean? 

I first heard it whilst listening to a podcast but it might have been a YouTube video or forum for you. 

Either way, you should leave this post knowing everything there is to know about GDV. 

And no we are not talking about bloated dogs…that’s a completely different type of GDV.

First of all, let’s define what GDV means in property.

What Does GDV Stand For In Property?

GDV stands for Gross Development Value and it is specifically used in property development (building properties from scratch). 

💡 GDV (Gross Development Value) is a metric which tells you the forecasted expected value of a project when development is complete.

Basically, GDV is the total market value of the project when completed.

For example, if there is a plot of land where you are building 5 houses and you expect to sell the 5 houses at £120,000 each then the GDV of the whole plot is £600,000. 

No. of properties: 5

GDV per property: £120,000

Total GDV: £600,000

To be clear GDV is a metric that looks at the total potential revenue of the development and not profit.

For profit, you will need to know all of your costs and minus them from your GDV.

You don’t hear the term GDV when talking about all types of property investment which is why you might not hear it much. 

How Is GDV Calculated?

GDV is mainly worked out by looking at comparable properties of similar quality in a similar area.


The key is that the properties should be of similar quality to comparables and as close in location as possible. 

💡 The more comparables there are, the more accurate the GDV estimate will be. The less comparables there are the less accurate the GDV estimate will be.

For example, if you are developing a plot of land with four 3-bedroom houses on it to a standard specification, you should find other 3-bedroom houses on the same road (or as close as possible) with the same level of specification. 

If you are building the highest specification property in an area then it will become harder to have an accurate GDV because the market hasn’t been able to value something like the property you are planning to build.

There might also be a price ceiling in certain neighbourhoods. 

If you build the nicest house in the UK but it’s in a bad neighbourhood in Grimsby (sorry Grimsby), it doesn’t matter that it’s the nicest house in the UK.

It simply won’t fetch as much as if you built that same house in somewhere like London. 

Construction Time and Forecasts

Another thing to consider when calculating GDV for your project is the likely market price at the time of completion.

Since it is a development project, there will be a chunk of time from starting the project to completing the project. 

In a rising market, this could mean your GDV will be higher than current market rates.

On the other hand, in a downward market, this could mean the GDV is lower than the current market rates. 

The longer your construction time is going to be, the more important these kinds of forecasts are going to be.

Why Is GDV important?

💡 Gross Development Value is an extremely important metric for investors and property developers because it underpins whether a potential development will be profitable, and if so, by how much.

If you’re looking for property investors for your development then you should definitely know what your GDV is.

From the GDV estimate, a developer or investor can work backwards to see how much they will profit from the development. 

Of course, they would need to know the costs of development too. 

The GDV metric is also useful if you need to figure out how much you are willing and/or able to pay for certain parts of the project. 

For example, if you know your desired profit, all transaction and construction costs, and the projected GDV, then you can figure out how much you are able to pay for land to make a project match your profit targets. 

This is really important if you are using land option agreements because you can decide how you want to negotiate a land option agreement to align with your profit goals.

Finance and funding will also rely on this, so having an accurate estimate for GDV (with justification) is going to be really important. 

Not only will having an accurate estimate be positive in terms of getting funding, but it will also make sure that your own expectations for profit actually come to fruition. 

Is GDV Important For Letting Out?

Yes, GDV is still important if you just plan to hold the properties and let them out. 

Even though rental values are going to be your main concern when developing with the purpose of letting out later, GDV will be useful for you. 

Firstly, GDV will give you an anchor point in terms of the property purchase price which gives you an additional data point so that you can figure out the rental value for the development. 

Also, even if you do keep the development instead of selling it, you may have the option to refinance the properties and pull money out at some point. 

Knowing your expected GDV will allow you to plan around this better, but of course, a lot of this depends on how you end up financing the development. 

Is There A Formula For GDV?

While GDV can be used in formulas to work out other things like the cost of land or the profit you will achieve, there is no particular formula to figure out the exact GDV of a property. 

Although some tools do try to do this for you, they won’t be exact and you should always try to validate and verify the information that data analysis tools give you.

This is because the GDV of a property depends on so many factors such as the specs of the property, where it is, and how big it is. 

The GDV of a project is worked out in the same way that you would value any other property – by looking at the local data and finding accurate comparables to base your estimate on. 

Of course, you can use a formula to figure out what your required GDV needs to be in order to match your business needs.

You would do this by first working out all of your other variables like costs and required profits, then work backwards from there. 

Have a look at the example graphic below which shows you how to arrive at a £250,000 required GDV for a given project where you need £50,000 profit.

Can I Use GDV To Work Out Profit?

Yes, you can use GDV to work out the required or expected profit in a property development.

All you need to do is:

Gross Development Value – Total Costs = Profit

Of course, you will need to know all of the costs that you will incur.

Costs would include:

  • Cost of acquiring land
  • Cost of professional and legal fees
  • Cost of finance (interest payments and fees)
  • Cost of construction (materials and labour)

Using Software To Calculate GDV

While you can work out the GDV of a development manually, you can also use software to assist you.

PropertyData is one example of a tool that allows you to value a potential development if you want to do things a bit quicker. 

PropertyData works out the value of a development using the £/sqft metric that they have for all postcodes in the UK.

This means that you will need to know the square footage of your projected development before you can use this tool accurately.

This tool can definitely help you get quick estimates of GDV but you should still verify these numbers with your own research.

I’ve linked to an article by PropertyData below where they give you a brief overview of this. 

The video below also shows you a comparison of working out GDV manually and then using PropertyData to work out GDV quicker.