PLEASE READ BEFORE POSTING

Hello Forumites! In order to help keep the Forum a useful, safe and friendly place for our users, discussions around non-MoneySaving matters are not permitted per the Forum rules. While we understand that mentioning house prices may sometimes be relevant to a user's specific MoneySaving situation, we ask that you please avoid veering into broad, general debates about the market, the economy and politics, as these can unfortunately lead to abusive or hateful behaviour. Threads that are found to have derailed into wider discussions may be removed. Users who repeatedly disregard this may have their Forum account banned. Please also avoid posting personally identifiable information, including links to your own online property listing which may reveal your address. Thank you for your understanding.

Selling to a Property developer

Options
2»

Comments

  • ringo
    ringo Posts: 8 Forumite
    Options
    Thanks for the reply.
    OK, assuming we pay for and get the full planning permission - how do we realise the added value to the site? Presumably the developers, knowing that it would have cost us less than 20K to get the pp., are not going to cough up another 300K for the site?http://img.moneysavingexpert.com/smilies/confused-smiley-013.gif
    :confused:http://img.moneysavingexpert.com/smilies/confused-smiley-013.gif
    :confused:
  • CB1979_2
    CB1979_2 Posts: 1,335 Forumite
    Options
    there's more than 1 developer ;)

    chuck it in an auction with a reserve price you're happy with.
  • lush_walrus
    lush_walrus Posts: 1,975 Forumite
    Options
    Ringo,

    The thing with gaining planning permission is not the actual cost in getting it, but the gain to the person buying it in terms of security in their investment.

    Basically, without planning permission the risk sits with the developer who in normal circumstances would be buying the property because they believe it has scope to do x,y and z. They then buy the plot and take the risk that the planners will agree with them and grant permission when they do sort everything and put in an application. The risk comes in because the planners may well turn the application down.

    If yuo get the planning permission yourself the risk is taken away as you will be selling the plot with the permission attached. the person who buys the plot will then earn their cut through actually developing it, with some of the cut already gone to you in the growth of the plots worth through the fact it has permission to develop. But, for the developer the risk is gone.

    If you get the permission you will be perhaps shutting off the chances of this sort of developer buying the property, but you will be opening it up to a hell of a lot more people who like to build things but without the risk.

    If that makes sense.
  • benood
    benood Posts: 1,398 Forumite
    Options
    I had a similar situation a few years ago - developers were crawling all over us. The way we tried to maximise value was after all the developers had looked the place over we asked for their best and final offers - some came back subject to planning others without planning - we chose the best for us at the time - our solicitor ran the whole thing for us. The advantage is you keep your options open and it's a bit of a dutch auction - I wouldn't risk an open auction too much risk of the bidders colluding to keep the price down.
  • ivavoucher
    ivavoucher Posts: 529 Forumite
    First Post First Anniversary
    Options
    I am in the middle of an exact same situation.

    6 months back all the estate agents all said no benefit to go for planning as it was obvious that panning would be granted for a replacement dwelling.

    Now I have gone for full planning the estate agents all say I have done the right thing going for planning before selling.

    I got 4 architects round and explained we only wanted planning to sell and they all wanted £15K to design the house of 4 to 5,000 sqr foot and obtain the full planning, none were interested in just plonking a readymade house on our plot which is the service I needed.

    On the fifth attempt I finally got an architect to do what we required and it has worked out at £4k plus £3k for tree removal for a 6,300 sqr foot home.

    I will never know if we would have sold for less without this planning but by removing all obstacles we hope to attract developers but more importantly the private individual who want a plot in a prime location to build a dream home and does not need to make 20% profit at the end of the build.

    The best way how to market and find the individual is my question?
    Auction is at the moment our preferred choice.

    Best wishes and good luck
  • lulupense
    lulupense Posts: 32 Forumite
    Options
    Avoid developers like the plague, all they want is to beat the price down and they will come up with all sorts of 'issues' until they have you in a place you can't escape, even down to completion day. Do it yourself! I was had for 11K on a tiny victorian terrace last year, stupidly I thought a developer was more likely to go through with the sale, he was but not until he had shaved every last penny off the offer price.

    I know everyone will say I should have dropped out but my financial position at the time was so wonky I couldn't. Now I am going to try and take the estate agent to the cleaners because they worked in the buyers favour,not mine! Wishing you luck and a lovely big fat profit whatever you decide to do.
This discussion has been closed.
★ ★ ★ Meet your Ambassadors

Categories

  • All Categories
  • 343.2K Banking & Borrowing
  • 250.1K Reduce Debt & Boost Income
  • 449.7K Spending & Discounts
  • 235.3K Work, Benefits & Business
  • 608.1K Mortgages, Homes & Bills
  • 173.1K Life & Family
  • 247.9K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.9K Discuss & Feedback
  • 15.1K Coronavirus Support Boards