Property dilemna - What would YOU do.

rizla01

Ok, so you own your house outright and also own an acre of land with FPP for a 4 bed house.

Not viable to build house, move in & sell existing so alternative is to sell the land (Which, because it is HARD to come by in this area, is still largely unaffected by price falls for someone who wants to live on the plot)

Do you SELL the land at this time, in a collapsing market and if so what do you do with the £250k that you get for it or do you leave it where it is?

The hope is to make as much as possible from the money and that would more likely be possible if it is in the bank and available for whatever comes along, rather than tied up in land.

WOULD YOU AGREE?

What would YOU do?

PasturesNew

I don't know.

Do you have any easier questions?

The price of land is tanking.
People can't borrow to do the building.
Builders are offloading land.

But, I just don't know what I'd do.

If I were young (20s), I might dig out the foundations (PP started so it's then secured forever) and sit on it until I was about 45-50. But if you're 40-55 then it might be best to get shot of it now.

A lot depends on your age, situation, plans, dreams and aspirations really.

dopester

Land prices seem to be crashing hard.

lynzpower

Id personally wait.

Im not sure there is LOADS of demand for land at the mo, wherever you are. It would be interesting to know how easy self build mortgages are.

I know last summer plots in London were going to sealed bids and selling for A LOT at auction.

If you put it on now at 250, I would expect whomever to be interested would try to drill down the price.

If you dont need the money now, then I would personally wait until real demand ( ie lending) is restored.

Incisor

All depends on the time scale over which the money is required. Only if it was necessary to realise value before recovery would I contemplate selling.

twokcc

£250k for acre of land sounds amazingly cheap, sold 3 plots last year all about 500 sq meters with full planning permission worked out at about £1m / acre. Is it not possible to get PP for say 3 houses could then sell plots individually just remember plot has still to be part of your garden so that you don't suffer CGT (assuming that 1 acre is currnetly part of your garden).
Also why is it not vialbe to build house?

rizla01

Hi,

Firstly it's green belt and the existing prop is tiny so to get a 4 bed on there was a little short of a miracle (Had to part submerge designed prop (Sloping ground) to enable the overall volume to be increased).


Three hopefulls are each offering 250 - 255k so that is secure but was 'on' for £285. (Stamp Duty prevails once AGAIN!!).

I could hold land in the hope of an eventual rise (3yrs or more) or sell up my house (Difficult as existing home was bought with the intent of full refurb costing £30 - £40k and will struggle to sell for more than I paid 12 Mths ago) to fund the build, but that would then mean living rough (caravan) or renting untill build was finished and then ALL of my funds would be tied up in the house, whereas by carrying on living here and selling I would then have 250k to play with AND a decent home (But not new) to live in.

A new home for me, was, like it would be for anyone, a dream that nearly happened but at 57 (but fit), and the OH reaching retirement aught to consider keeping funds behind us, but the money isn't going to get much interest and, if traceable will prevent her getting any pension top-up.

My only thinking is that the money from the land could prove useful if a cheapo prop comes along during the downturn, which we might be able to make a few bob out of.

What would you advise?

twokcc

We were in a similar situation with a bugalow that neaded about £70k spending on it. Built by a builder for his own occupation in 60's when it would have been considered exceptional but badly needed mordenising. Plan was to do this and build a new house on garden at back(total area .75 acre). Every architect we saw suggested we demolish the bungalow something that we had not even condsidered.To make this work financially for us we had obtain planning permission for 4 houses.You don't say how much your existing house is worth but if it is less than £250k may be worth considering this. Have you considered getting planning permission to demolish this and replace with a new build. This may now be easier as you have set a precedent fot the type of property that can be built with the PP for the new property. Obviously if demolition would allow you to get further 2 properties on site this could maximise the site value. Don't have any experience of planning in greenbelt so this could be a complete no go, ours was in a conservation area and we had problems with a supposedly rare tree. Took us 2 years to get PP and it was a full time job(had fortunately retired so was able to spend 100% of time getting PP). Was hard stressful work but learnt a lot about planning and tree preservation orders. May be worth trying to find a specialist in planning in green belt who could advise you if any alternatives are available that would maximise site potential. We used a architect who mainly worked locally so had a knowledge of almost all precedents that had been set for PP. Employed probablely best tree specialist in north east of england to assist with dealing with council.
Don't know if this will help you have obviously been successful in obtaining PP for first house so you may have already considered demolition of existing property to replace with a new build.
Regarding your offers how have you marketed the plot, although we spoke to 3 estate agents we sold it ourselfes and got nearly 20% more than max price advised by them(this was Aug-October last year).

planning_officer

twokcc wrote: »

Have you considered getting planning permission to demolish this and replace with a new build. This may now be easier as you have set a precedent fot the type of property that can be built with the PP for the new property. Obviously if demolition would allow you to get further 2 properties on site this could maximise the site value. Don't have any experience of planning in greenbelt so this could be a complete no go.

Yep, in Green Belt, it is pretty much a no-go. Replacement houses are ok in principle, subject to them being not materially larger than the existing house, but new houses are usually a complete non-starter. The only exception is limited infilling in defined villages (they have to be allocated in the Local Plan for this) - but then, it's limited to one or two dwellings in a gap in a row of existing houses - certainly not backland development in someone's garden.

rizla01

twokcc wrote: »

Regarding your offers how have you marketed the plot, although we spoke to 3 estate agents we sold it ourselfes and got nearly 20% more than max price advised by them(this was Aug-October last year).

HI Twok,

Thanks for your comments.

I would be very interested to know how you marketed the land yourself.

Problem is now, that, at this time of the year, traditionally, people are reluctant to think about house/land purchase - and that was BEFORE the downturn, and who knows what is around the corner with this Government plus this particular set of circumstances.

I wouldn't worry about keeping the land for a few years but OH's job (In the Housing Market, would you believe?) is probably finished in Jan 09 and money in the bank could be good (Depends on interest rates) and we don't want to risk getting LESS for land by delaying things for much longer.

Anyone got Crystal Balls?:A

twokcc

Hi rizla01

We started off by putting the plot on the site on Homebuild and renovating, intially got a far amount of response to this ,however most fizzled out because of the delay in getting planning permission. Once we had PP we had a for sale board made up by a co.on ebay saying puilding plot for sale with full planning for x bedroom/bathrroms/garage etc, may be worth putting that plot size is 1acre. with contact no. Got a huge response from this (although a lot were builders so that could have changed now). We prepared a pack for each viewer that they could take away detailing provision of services, copy of plans, PP conditions etc. Set a deadline date for sealed bids to be submitted to ourselve, a month in our case but may pay you to wait until spring next year. On viewing we advised potential buyer verbally of amount we were seeking so offers would have to be above this to secure.(you only haveto sell if you get an offer that you think is accptable). Also found that putting word about in village helped, although most knew once board had gone up Got 7 bids. Obviously this will not help if you don't have any passing traffic.
Note planning officers comments, have you considered the points he makes, know it may be outside chance but points he makes may apply to your site. Also believe that nulabour (John Prescott?) was going to making getting planning permission on green belt easier, planning officer may know more about this. If this could make it easier to get PP later may be worth waiting.
Hope this helps