What to do if you are thinking about selling land
If you are sitting on a parcel of land that isn’t getting used, you may have been thinking about selling it.
However, if you are a real estate novice, it can be difficult to know exactly what to do. Should you sell it or leave it? Should you sell it to developers? What about planning permission?
If you are feeling confused about your options - don’t worry! In this article, we will detail how you can go about selling your land, and how you can value it.
Approaches to selling land
There are three main approaches to selling land, and each comes with its own benefits and costs. As a result, the best choice for you really does depend on your own individual preferences.
The first one is simple: selling your land as it is. There are many reasons why this might be the best option for you.
Firstly, it is by far the simplest option! You won’t have to spend months worrying about planning permission, filling out hundreds of forms and racking up administration bills.
If you are looking to sell quickly, this may be the easiest option for you, especially as house and land prices have been rising in the last year.
The downside of selling your land just as it is, however, is that you might have to sell it for a lower value than if you were to sell it with planning permission.
This is because, for buyers, there is a risk involved, as they won’t be able to tell whether or not they will be able to get planning permission until they purchase the land.
Therefore, although this is by far the simplest method of selling your land, you may have to accept a slight profit reduction.
Selling on a ‘subject to planning’ basis
There is a great risk involved when it comes to buying land without planning permission.
One way to get around this is to agree to sell the site, provided that the seller has agreed to buy planning permission first. This can help to reduce the buyer's risk, as they know that if they fail to secure planning permission that they won’t have to buy the site.
Because of this reduced risk, this can lead to your land going up in value.
The main downside of selling in this manner is that you are selling land on a subject to planning basis, which can potentially mean that you won’t make a quick sale. It could take a long time but can be worth it in the long run.
If you have a property developer interested in your land, but you don’t want to go through the hassle of getting planning permission yourself, this may be the right option for you.
Selling your land with planning permission
Securing planning permission for your land may increase the final sale value of the land. Developers want to buy land that they are sure is going to make a profit, so land that already has development permission is the perfect site to buy.
An outline of planning permission may give developers more confidence with their purchase, whilst also being flexible enough so that they can make adjustments as they see fit. This will increase interest when it comes to a sale, meaning that you can sell your land for more money than without planning permission.
There is a big downside to selling land with planning permission, and that is that it can be a long and expensive process that is often complex. In fact, going through the process of obtaining planning permission could leave you considerably out of pocket - even if you factor in the increased sale value of the land.
How to value my land?
There are a wide variety of factors to consider when trying to value your land. The value of land depends on a wide variety of factors, including:
- Location
- Condition
- The value of the land surrounding it
- The relative scarcity of land in that area
- Where the land is based
- Whether or not the land has planning permission
Because there are so many factors that affect the value of land, you should always make sure that it gets valued by a professional before you consider selling or getting planning permission.
At NFC Homes, we have over 15 years of experience in property development. If you are interested in selling your land or believe that it has the potential to be developed, we would love to hear from you. Get in touch with our team today for expert advice or to learn more about your options today.