backland development - how much is land worth(21 Posts)
we've been contacted by an agent who are interested in buying some of our large garden to put a house on it. We might be interested in this, but have no idea what value the land might have.
Can anyone give me any idea? I've come up with more than £20k and less than £100,000 but that seems a pretty wide ballpark! Does anyone know? Has anyone done this?
We are in the midlands.
Would it not depend on how much the house could sell for, ie how much profit the company could make? That’s why the land prices vary so much. It depends on where you are. If they can get permission for an amazing designer property or just a big standard house. If there are good views etc. Lots to consider.
Ihave no idea! I have never given this a moments thought. Rightmove seems to sell land at all different prices and I have no Idea how to consider this.
Thanks for the tips
Get it valued. Look up a local surveyor who will help you.
It really depends on a variety of things eg is there already planning permission - 2 plots near us sold for in excess of £400K each in recent years, they both had planning.
You need to get it valued by at least another company.
There are agents who specialise in selling land, that’s probably your best bet.
Don’t forget Op though that it might affect your house price as well. So it’s not just the value of the land but also any reduction in price (and/ or saleability) of your house. You also have all the noise and disruption of the house being built and potentially closer neighbours. I’d have a chat with several local estate agents and get the feel of the local market.
Yes cat, these things are all issues for us, but if it is happening next door then it feels a bit "can't beat them so join them"
We are planning a move, so we are trying to see it as a business decision.
what size house would go on it? if you have a vague idea you could work out likely build costs of the house.
then it would be the total value of the property when its finished,minus build costs, minus around 20% profit = remaining figure is what they could pay for land.
Are there similar building plots on estate agents websites to give you an idea.
I reckon it would be a 4 bed house approx.
If you can give me an idea on build costs then I can do that equation as there are loads of new build 3 and 4 beds around here.
If you are planning to move anyway then could you offer the whole lot then it would just be an ordinary house sale for you.
for an estimate I'd say use £2000 m2 which is higher than the mass builders would use to allow for a highish spec but assumes no major issues with the land / contamination etc.
I'm building some in the north atm but they cost 1700-1900 and we are doing multiple units. so use that as a guide depending on how nice the area you are is
Depending on the size of your plot and the amount of land sold you may have capital gains tax to pay (vague memories of pe2 tax)
There are so many factors to consider it’s impossible to put a ball park figure on it
The ease of gaining planning permission (is it a conservation area / aonb/ near listed buildings/ otherwise protected) any tree preservation orders
The ease of supplying access (highways) / utilities / drainage etc
The detrimental impact to your house
Has the land any covenants
The local market
The underlying geology
And so on
This is very helpful thanks. We clearly need to take our own advice on this and not just blindly walk into the offer.
Next door is going to planning in June so we will have a good indication of what is possible at that point. It is a very conventional piece of land and there are plenty of new properties around.
Thanks for the estimates of build costs. I assume that is for the footprint of the new property rather than the land including gardens/drive way etc. I am clearly not good at calculating area as my sums are out of whack. Our house is approx 2000sq ft up and down, which I work out to be 1000 on ground, so 300m2 which, times by 2k is Wrong. (presumably they are not going to give us a million!)
We have had the same thing , its been ongoing for a few years. We had just moved in when they approached us, we ignored them for 6 months but then they told us all the neighbours (6 others ) had agreed so we could either join in as we are the end property or not and they would go a head anyway without us and potentially go down the road the other way. It depends on access, so for us they had arranged to knock down the two semi detached houses next door for an access road, and then go across 7 semi detached gardens in total (including the ones they wanted to knock down). Each garden length they would take is about 40m by 7m across. I have no idea what the others were being paid they offered us just over 100k and then it went on for years them trying to get planning, so then they dropped the price to just under £100k as they didn't get the houses they wanted. Still ongoing. We are in the south east. Anyway if you have a mortgage you will need to ask your lenders permission to sell, they will send someone round to value your house and tell you if you can and if the value will be affected by selling your house. A good solicitor will handle this for you. They will ask you to sign an option agreement so you will need a very good solicitor and go over every detail. |Do not trust the developer, check every line in the option agreement. Look out for who will own and pay for the boundaries going forwards, ask them what they are building, they will lie and say a couple of 3 bed houses and then put in planning for 4 5 bed houses etc. A rule of thumb is a third for the land a third for the build and a third profit for the developer. A surveyor or a land agent might be able to tell you what the land is worth.
Enormously helpful thanks so much.
I think the test case for us is whether they get planning for the bit next door because then we know the lie of the land - literally
I hope it doesn't always take years
As others have said it's a very hard thing to give you a ballpark figure for
Land and build prices can vary so much up and down the country it could vary from thousands to millions depending on where you are and the situation (access, planning, viability, desirability)
You need professional advice from somebody who can give you advice specific to your situation.
Often developers will take an option (small payment to reserve) on a piece of land and then only buy it if and when they get planning permission - this can be a long drawn out process depending on the local planning situation.
Why not apply for planning yourself? Why let someone else make all the money ?
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