Does a house in AZ have to have heat to be livable

We did an appraisal for a house in Ajo, AZ. There was no central heat in the house. The only heat they had was space heaters, which personally, we consider to be more of a fire hazard than anything else. We told te borrower that a house is not considered livalbe without heat. At any rate, the lender will not go through with the loan due to the house not having heat. Borrower wanted to know what was the least amount of heat he can put in in order to be considered "livable". Can he do wall units or baseboard units or will he have to get central heat. Any help you can give would be appreciated. Thanks.