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Is it worth buying land?

mugatool
mugatool Posts: 16 Forumite
in House buying, renting & selling
I've recently come across land for sale in the Hertfordshire area. There is development potential for new built houses and already planning permission but I've never actually been involved in building from scratch. I have invested in property in the Midlands and was hoping to invest in property in the commuter belt but I'm not too sure whether I should risk buying land. If anyone has any experience in buying land I would really appreciate the help :)
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Comments

  • G_M
    G_M Posts: 51,977 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
    Use bing, google, yahoo or similar.

    There are many websites, forums etc dedicated to self-build.
  • menachem
    menachem Posts: 8 Forumite
    I didn't have experienced in buying land but, I think you need invest time and money. Time in a sense that you will have to find architect, choosing element structure and etc.
  • Doozergirl
    Doozergirl Posts: 33,803 Forumite
    Name Dropper Photogenic First Anniversary First Post
    You have homework to do. I'm not sure that sitting on land is an 'investment', more a project where you release your profit by building.

    If the land has planning then there is a value on the finished building and a budget for the build. What is left is the value of the land plus 'profit'. You need to decide what you want from that land and if the figures stack up.

    Are you ready for a building project a long way from home (if it is?). Do you have a builder lined up?

    The buyers for land with permission will be either a self-builder who may be prepared for a more modest saving on the final product, or seasoned developers who can take their profit from having the team themselves. Someone employing a builder and expecting a profit will be in a similar boat to most self-builders in that some of the 'profit' goes to paying a third party - the builder .

    Make sure the planning permission hasn't lapsed!
    Everything that is supposed to be in heaven is already here on earth.
  • knightstyle
    knightstyle Posts: 6,988 Forumite
    First Post First Anniversary
    Most important is to talk to the authority who gave the planning permission about it. How long till it expires and what can you build, plus who will pay for services etc.
  • ReadingTim
    ReadingTim Posts: 3,970 Forumite
    Name Dropper First Anniversary First Post
    • Why is the current owner selling it, rather than doing as you plan?
    • Why has no-one else bought it and done as you plan?

    I would hazzard a guess that if it was possible to do as you plan, it would have been done by already. If it hasn't been done, it's probably safe to say it can't be done.

    And anyway, what is it they say about things that sound too good to be true...?
  • bridgette1
    bridgette1 Posts: 2 Newbie
    Hey there, I only have info about the french market since I live there, this is a good resource to browse and compare plots and land maybe you have something similar for your contry? Hope it helps.
  • System
    System Posts: 178,093 Community Admin
    Photogenic Name Dropper First Post
    The short answer is, there is no short answer!
    Buying land and developing it has the most potential reward and the most risk associated with it.
    Lots of small plots don't stack up for developers as the costs of utilities can wipe out profit if you can't build enough houses.
    It really is down to doing your homework and trying to figure out exactly what the potential of the individual plot is (if you are going for private sale be careful with the numbers as there are thresholds for % of affordable units etc)
  • steampowered
    steampowered Posts: 6,176 Forumite
    First Anniversary Name Dropper First Post
    There are an awful lot of people that have got badly burned by investing in undeveloped land.

    If you want to do it as a self-build project and there is demand for houses in the local area, that sounds great. But a lot of work is required - it isn't a "buy and forget" investment.
  • AdrianC
    AdrianC Posts: 42,189 Forumite
    First Anniversary Name Dropper First Post
    mugatool wrote: »
    I've recently come across land for sale in the Hertfordshire area. There is development potential for new built houses and already planning permission but I've never actually been involved in building from scratch.
    Pause, and ask yourself one little question...

    How come you can do this profitably, with no experience, when experienced professional developers can't?

    After all, if they could, then they would already be doing so.
  • movilogo
    movilogo Posts: 3,186 Forumite
    Name Dropper First Post First Anniversary Photogenic
    How come you can do this profitably, with no experience, when experienced professional developers can't?

    It is more of they don't rather than can't. It is similar to ask a BTL landlord how come you buy a house while banks don't even if they have more money than you?

    Developers don't usually buy land for buidling only 2-4 properties. They do it at much larger scale.

    Buying land could be profitable. But make you first network with people who have more experience about it.

    Sometimes you can make profit even if previously planning permission was rejected on the plot. A different planner can simply present a new plan which could be accepted. Then you can sell the land for a profit.

    There are lots of parameters. It is doable if done correctly. Just make sure you know what you are doing. MSE forum is not the best place to discuss this business model.
    Happiness is buying an item and then not checking its price after a month to discover it was reduced further.
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