When it comes to selling land, farmers and landowners who are considering entering the marketplace need to plan in advance and take note of the challenges and obstacles which they might meet along the way.
There are a number of factors that need to be considered. For example, location, the current state of the housing market, transport links, and physical attributes will all either add or take value away from a plot of land.
For any landowners selling land which they may think has obvious ‘potential’, they should first need to check that there are no pre-existent Occupancy Restrictions, Overages, or Restrictive Covenants. An overage clause is the means through which a seller may be entitled to receive further monies after completion. For example, this might apply to farmland which is later sold off for housing. If the buyer then gains planning permission for residential development, a subsequent seller may find an earlier owner wanting up to 75% of the uplift in value. If the purchase was based on redevelopment potential, the buyer would rightfully be reluctant to progress any further as most of the profit gained from the permission and efforts of the subsequent buildings would go straight to the previous owner.
Here is the thing, while many guides often extol the virtues of buying land, very few detail the process of selling said land. Depending on the purpose that your land serves (or previously served), selling your land is a relatively straightforward process. In the following guide, we will outline how you can sell your land and the avenues that are available to you.
Things to consider before selling
When looking to sell your land it’s important to take into consideration a few things before you go ahead and list your land for sale. One of the most important things you can do, and something that is overlooked (at least on a commercial level) is to first consider who the future buyer of the land may be.
While it might seem counterintuitive to care about the potential needs of a currently unknown buyer, it’s important to understand that in order for you to successfully sell your land, you need a new buyer to come and take it off of your hands. As such, failing to ensure that the land is attractive and appealing to potential buyers is a surefire way to end up sitting on an unsellable asset.
So, how can you go about making your land more appealing to potential buyers? One of the most surefire ways to garner more attention to your land is to seek and obtain planning permission for site-appropriate developments prior to selling. By obtaining planning permission for future structures, you’ll be able to make the life of a potential buyer that much easier. Any buyer who wishes to expand or use the space for a specific purpose will already have permission to develop on the land, thus making your land more appealing to buyers.
An example of what this would look like if planning permission was granted. The landowner would typically advertise; an opportunity to develop residential properties in a sought-after location. The land benefits from planning consent for the erection of seven new dwellings etc.
With this being present to a would-be property developer, the chances of selling the plot of land would increase dramatically.
Lastly, one of the other key things to consider when selling land is the existence or planned construction of nearby developments. While your land might be vast and possibly reside in a rural location, that does not mean that you’ll always have the luxury of having no other developments/neighbours in the surrounding area. As such, it’s important to understand that the sale of your land can be both positively and negatively affected by any developments in the surrounding areas.
As a landowner, it’s vital that you stay aware of any developments or sales in the area such as new roads, other rural facilities, and any land sales that may have recently occurred. New roads, train lines, or flight paths can have both an adverse and positive impact on the value of your land.
Should you be raising animals or livestock, a new nearby road could actually cause the value of your land to rise. Roads are typically the most commonly used method to transport goods around the UK and as such, a new road could significantly cut down transportation times and improve the connectivity of your land to major cities, ports, and motorways for instance.
However, a new commercial flight path over your land could result in an increase in noise pollution. Meanwhile, a train line close to your previously secluded farmland could scare and unsettle your livestock.
With all of the above considered, as a landowner, it’s important to remember that failing to keep abreast of local developments and potentially even national or international conditions, could result in your land losing value if you were to put it on the market at the wrong time.
How to sell your Land?
Similar to selling residential property, there are typically three ways that you can sell land in the UK.
Auctions
As with buying land, one of the most common ways to sell land is also through an auction. Typically, selling your land via auction is a lot more straightforward than dealing with agencies, and can often be a great way to sell your property quickly.
However, should you wish to seek the highest price possible, an auction might not always be the most suitable way to find a buyer. Auction houses tend to attract bargain hunters, so unless your land is highly appealing, and creates some competition amongst bidders, you might find that an auction could result in a lower-priced sale than you were expecting.
Offline
Much in the same way as selling your land online, this is all done through estate agencies. Typically, land sales are conducted by specialist estate agencies that have years of experience in the sector and are effective experts on the nuances of selling land.
Online
If you’re looking to sell land online then look no further than Propetly. As a landowner, Propetly’s leading online property development portal will allow you to sell your land and market it to thousands of potential buyers throughout the UK.
All different ways of selling land have advantages and disadvantages. The future of the property market is undoubtedly a digital transformation. Using an online tool, you can search for information about your desired property project, developer, and comments and reviews. Search results with interesting comparisons with “similar projects” help property seekers to judge the fairness of the project’s pricing, features, and more.
The good old property mantra, location! location! location! is accessible online. Contrasting this to searching offline. In general, offline property seekers require a little bit more legwork than simply browsing Propetly or another site from the comfort of the sofa. In addition to getting out of the house, an offline search requires enlisting the help of an estate agent. After scheduling an appointment with an estate agent and finding a property or plot to view, the process can be deemed as time-consuming and on occasion, a waste of time which then harbours frustration.
Thankfully, as a seller, you’re often able to state a ‘reserve price’. A reserve price is a confidential minimum sale price that you have agreed with the auction house prior to any bidding taking place. Commonly, a reserve price may be up to 10% higher than the land's guide price and protects you from losing a significant amount of money in the event that a competitive bidding war does not occur.
By the team at Proverest, Published November 9, 2022
