When you're planning a property investment or development, it’s easy to get fixated on interest rates or monthly repayments. But smart investors know that three numbers matter just as much—if not more—when it comes to securing the right finance:

✅ LTV – Loan to Value
✅ LTC – Loan to Cost
✅ GDV – Gross Development Value

These aren’t just finance jargon. They’re essential tools for understanding risk, gauging lender appetite, and optimising your deal structure.

Let’s break them down.

🔢 What Is LTV?

LTV (Loan to Value) is the ratio of the loan amount to the current or purchase value of the property.

• Formula:
  Loan Amount ÷ Property Value × 100
• Example:
  If you're borrowing £300,000 to buy a property worth £400,000, the LTV is 75%.
• Why it matters:
  Lenders use LTV to assess risk. The higher the LTV, the more risk they take on if the property value falls.
• In 2025:
  Most buy-to-let and residential mortgages cap LTV at around 75–80%, though some specialist lenders will go higher for strong applicants.

💷 What Is LTC?

LTC (Loan to Cost) is the ratio of the loan amount to the total cost of the project—especially relevant for development and refurbishment deals.

• Formula:
  Loan Amount ÷ Total Project Cost × 100
• Example:
  You're building a home with total costs of £1 million (land + build). If your loan is £700,000, your LTC is 70%.
• Why it matters:
  LTC helps lenders understand how much of your own capital you’re contributing. The lower the LTC, the more “skin in the game” you have.
• In 2025:
  Most lenders offer LTCs between 60–75%, with a few stretching higher for experienced developers with strong exits.

🏗️ What Is GDV?

GDV (Gross Development Value) is the estimated market value of a project once it’s completed.

• Formula:
  This is a valuation based on local comparables and market demand—not a strict equation.
• Why it matters:
  Lenders want to know what the project will be worth once finished. This helps them assess exit strategies (sale or refinance) and determine the maximum loan size.
• In 2025:
  Lenders may cap development finance at 65–70% of GDV. So even if your LTC is low, the GDV limit may be the final cap on your borrowing.

🧠 How They All Work Together

These three metrics don’t exist in isolation. Lenders consider all three when structuring a deal:

• Bridging Loans: Focus more on LTV (asset-backed security).
• Development Finance: Balances LTC and GDV carefully.
• Refurbishment Projects: Typically assessed using a combination of LTV (at purchase) and GDV (post-works).

A strong deal will usually meet acceptable thresholds on all three fronts. Here's a quick comparison:

📊 Key Finance Metrics at a Glance

LTV (Loan to Value)

• Use Case: Purchase / Refinance
• Ideal Range: Up to 80% (residential), 75% (buy-to-let), 65–70% (bridging)

LTC (Loan to Cost)

• Use Case: Development / Refurbishment
• Ideal Range: 60–75%

GDV (Gross Development Value)

• Use Case: Development Exit
• Ideal Range: Max 65–70%

💡 Real-Life Scenario

Let’s say you’re buying land for £200k and building a house for £400k (total cost: £600k). You expect it to sell for £900k.

• Loan required: £450k
• LTC: £450k ÷ £600k = 75%
• GDV: £450k ÷ £900k = 50%
• LTV (if valued mid-project): depends on the stage, often irrelevant here

That’s a healthy GDV and LTC for most lenders in 2025.

🛠️ How to Optimise Your Deal

Here’s how savvy investors improve their position:

• Lower your loan size with additional equity to improve LTV and LTC.
• Increase GDV with value-adding renovations or extensions.
• Shop lenders—some care more about one metric than another.
• Package your case well—include a detailed cost breakdown, comparables, and planning documents.

🚩 Common Mistakes to Avoid

• Confusing LTV with LTC—this is especially risky in development finance.
• Overestimating GDV—lenders will usually apply their own, more conservative valuation.
• Ignoring exit strategy—lenders want to know how they'll be repaid.

📌 Summary

LTV (Loan to Value)

• Definition: Loan ÷ Property Value
• Main Use: Purchases & refinancing

LTC (Loan to Cost)

• Definition: Loan ÷ Total Costs
• Main Use: Developments & refurbishments



GDV (Gross Development Value)

• Definition: Projected Final Value
• Main Use: Exit strategy & maximum loan cap

📞 Want Help Navigating Today’s Market?

Book a free strategy call with one of our mortgage specialists.

We’ll help you find the smartest way forward—whatever rates do next.