How much is an acre of land worth?
If you find yourself in the fortunate position of owning land in the UK, then congratulations are due to you. Despite gloomy Brexit fears and the global pandemic, it is an undeniable truth that land is always at a premium. Despite the Government’s pledge to build three hundred thousand new homes a year falling short due to Covid-19, the need for land is still as pressing as ever. But how should you go about selling your land and having it correctly valued?
What is an acre?
The word ‘acre’ is simply old English for ‘field’. Whilst it sounds like a quaint and insignificant measurement, in easy visual terms, an acre is roughly half the size of a professional football pitch and the average developer will manage to build fifteen to twenty houses on a piece of land this size. Whilst an acre is always an acre from the perspective of quantity, an acre in the city is going to have different importance to an acre in a very rural location, purely because of supply and demand.
How much is an acre worth?
There are several variables one has to bear in mind when answering this question. Firstly, the intended use of the land is key. Farmland is not the same as land intended for residential development. Location can have a heavy impact upon price, as can the local environment, infrastructure and topography, economic activity in the locality and supply and demand. If the land comes with planning permission at the time of sale, in theory, it will be much more valuable than land without.
How to value my land
When it comes to the process of how to value land, there are a number of variables to consider. Government estimates can provide some broad averages to work from, as can land value calculations. The current market value will also provide you with an idea as to how much your land may be worth, but it is important to have a thorough grasp on this before you begin and to only consider consulting well known professional companies with a proven track record. At NFC, we utilise specialist mapping software which enables us to look up this information for you. If you'd like a free appraisal for your land, visit our land wanted page.
Factors that affect the value
A developer will be interested to know what the connection to utility services such as gas, water and electricity is like, as well as domestic considerations like rail links, schools, hospitals and parks. The geography of the site, including its tendency to flood, will be of interest and other developments in the local area will also be a matter to contemplate when seeking to ascertain the potential value of property.
Gaining planning permission on my land
Unfortunately, the planning application process can be notoriously slow and has the potential to become quite complicated. After making a submission to your local planning authority (LPA), the best-case scenario of obtaining planning permission can take between 8 and 13 weeks depending on the application. However, this often takes considerably longer, typically several months.
Selling land with planning permission
On one level, selling land with planning permission rather than without is financially preferable for the vendor as they are more likely to achieve a higher price for the land. However, the planning permission will have been granted with several caveats in mind, including the style or number of buildings being erected upon it which may vary from the developer’s overall concept, which could affect the price. Because of the time frames involved in gaining planning permission, not to mention the amount of paperwork and cost, some people prefer to sell without. While this gives them a faster turnaround and gives the buyer more free reign with the type of development, this does mean that the vendor will likely receive a lower price for selling their land. The other option is to sell it ‘subject to planning' which can be beneficial to both parties. The buyer takes the brunt of organising planning permission, including paying for it, whilst the vendor receives the benefits of a higher price once planning is granted.
Selling land to a developer
Regardless of whether your site has planning permission or not, if you are ready to sell your land, it does pay to deal with a reputable developer. You are far more likely to achieve a fair price and the administration will be completed by experts. Land sale and planning can be minefields for the uninitiated and trying to go it alone can outweigh the overall benefits.
Based in central London but operating nationally, we at NFC Homes have over fifteen years of experience developing both residential and commercial developments. With a strong set of corporate values and in-house planning, legal, surveying and construction departments, we are renowned for delivering quality results on time and on budget. If you're in possession of an acre of land (or multiple acres) that you'd like to sell, contact us today for a free, no-obligation quote.