Uplift Clause in Sale

[AnythingConsidered]

We've found a property we really like and want to view (we're sold and desperate to find some where to buy). I booked a viewing for tomorrow, but have just noticed this note right at bottom:

Agent Note
The property will be sold subject to an uplift clause whereby the current Vendor's will receive 30% of any increase in value upon the grant of planning permission for any new residential, commercial or leisure development over 25 years, from when the property is sold.

Anyone seen anything seen anything like this before? Been able to get it removed?or negotiate?

We want to live in the house as a family for the next 15 years, and have no intention of developing (other than maybe an extension in 5-7 years time) but I'm now thinking this clause will make it difficult to sell on.

Also, it feels like 30% is such a high sum and 25 years is such a long time!!!

If it just me?

Link for those interested in full details

That's usually a clause that's put on land rather than a residential property. Is there substantial acreage with the property?

It’s not unusual to have an overage clause on properties that have land, especially if said land has been identified as being of potential interest to developers etc for building on. More common to see it on large acreages but certainly not unheard of for even large enough back gardens etc to have it.

@Clymene yeah, has grounds and woodland circa. 4.2 acres.

Interesting that it's usually for land, I can't imagine developing it. It's beautiful

That’s a beautiful home!!

It’s very common for agricultural land, equestrian properties or similar where acreage is being sold, or partitioned up into smaller plots and sold. You need a decent conveyancing solicitor rather than the cheapest you can find so you get some proper advice about it.

You definitely need someone competent to
check the drafting!

I'd say that 25 years is a long time and would look to push back on that.

The sort of things you'd need to get checked are:

• what sort of extensions will trigger the payment? Are you happy to pay even if you do a small extension (probably not!)
• you should only have to pay when you implement the planning permission if you sell once you've got it.
• the 30% needs to be after your costs of getting the planning consent.

That's just a few headline points : there's lots to think about!

Are you already local? That's my neck of the woods. I think I visited the family that lived there 35 odd years ago!

I'd wish I'd known it was up for sale, as it's exactly what I'm looking for, but it's just a bit above budget.

I'd be ok with that. 25 years for a family home is not that long- it's not a house I'd buy intending to move. I'd retire there. Kids would have to sell it when I die!

They aren't restricting development of the house itself, so extending, renovating etc looks ok. Might be dodgy if you wanted to develop the shed into an annexe for an adult child/parent/au pair or something. Worth checking that.

Bit of a money pit though. Might need rewiring, heating- either getting gas in, or a ground source heat pump and loads of insulation, maybe a biofuel boiler, as there's plenty of space. Obviously bathroom and kitchen.

Please feed back on it!

They're expecting to sell to a property developer who'll knock it down and build many tiny houses rammed on top of each other in its place

I’d suck that up if I wanted the house. I’d want to make sure it doesn’t include extension or development of the main dwelling and just applies to development of the land. Of course you could try to negotiate the terms, but it may not even affect you if you’re not planning a development

What a beautiful house and land. If you want it, seek advice from a specialist solicitor who may recommend you push back on some of the clauses.

Agree they are hedging bets and expect to sell to a developer.
Have you checked out whether any planning applications have been made in the past?

Wow it’s lovely. I love the parquet flooring.

as others have said these sort of clauses (overage clauses) are common on agricultural land where the buyer is likely to apply to build a bunch of houses. Because developers sometimes land bank they can be quite long.

you’d be well advise to speak to a solicitor before putting in an offer. If you are not planning on developing then it makes no difference but you need to be clear what counts as “development” - I.e would an extension of a summer house be caught?

I feel you OP. My husband and I are currently looking to by with land for thre horses and although I appreciate I am pro ably cutting off my nose to spite my face we skip over anything with an uplift clause.
I think if rhe cheeky feckers that are selling want to benefit from development they ahouod do it themselves before selling.
Also the majority of these are on planning permission being granted nit on compelted develeolment and futyre sale so they want their payout before you've even developed or sold the land, or even benefited by selling at a later date yourself.

If they want extra £££ they should get planning before they sell and then sell at an increased price

From the pictures they don't want the golf course owners to make a fortune out of it... or is it the golf course owner selling (because they can't get planning permission) and don't want someone else profiting from it.

I think people are coming at this from the wrong angle, it’s to stop the situation where the seller thinks they are selling as a family home and the buyer then strips it down, overdevelops and sells at a massive uplift. It’s very common, called an anti embarrassment clause.

if it’s your forever home then the clause is irrelevant.

Exactly this ^It's a protection clause. If I were to sell my equestrian property I would do this do as in South East where every postage stamp of land is being built upon without public services keeping pace.

@myplace not local but an hour away and spend most holidays and weekends in the Wye Valley/Brecon.

always wanted to move closer and DHs new job in Bristol gives us the opportunity, but we can't find anything we like in budget - and this one is gorgeous & great location for the commute

@Keepingthingsinteresting I guess I can understand that, I think it would be sacrilegious to build anything on.

It's the number of years I have the problem with. 25 years is just so long. Who knows what will happen (DH would be 75+ in 20 years) & I worry the clause will carry forward making it difficult to sell on.

Oh my, please figure it out and buy it. It's beautiful!!!

But by the time you sell on, it will only be a few years left on it, so no real impact on the price.

Also there may be no one left to pursue it.

@DaniCalifornication there is an element of that in my reaction too!!

I don’t think it’s a bad overage clause really, I’ve seen 50% ones for the same length. If it is just going to be a family home it isn’t a problem?

Backing onto Celtic Manor it’s ripe for development so I can understand it!

Oh that's such a lovely house 😍

Just be aware that road is a bit fast and furious at 3.20 on a school day. It's fine the rest of the time.

Old Roman rd is effectively single track with passing places. If you try and go against the flow at school time, it's bad news.