strip of land

davz_2

I have a strip of land which a builder wants to buy off me to gain
access to an adjacent plot of land. On this land he wants to build 22
houses, ranging in value between 160k and 260k, the development will
have a value of approx 5 million. The builder has an agreement with
the landowner of the development site to purchase the land if planning
permission is given. I guestimate the land value at least 2 million
with planning permission and very little without permission. The only
access to the site is via a strip of land belonging to me. So the land is worthless without my land, it in effect being the key to the door.

Question is how do i value the strip of land I own? What would it be
worth? I don't want to get ripped off!

silvercar

Research "ransom land". The answer is a lot of ££££!

Generalising a development is a third land, a third build and a third profit. A sizeable chunk of that profit is your aim!

PasturesNew

A similar scenario (allbeit not such a high value) was discussed here:
http://forums.moneysavingexpert.com/showthread.html?t=1455035

Although that particular thread isn't particularly information-filled, it does answer the first raft of questions you might have.

There are other threads, I'll see if I can find them, where they tell you that you need to get a professional (RICS?) on to value it for you.

PasturesNew

Also, read this one (more informative): http://forums.moneysavingexpert.com/showthread.html?t=515952

Here's a random google result, where somebody with a piece of development land seems to be finding out how to get access to their site:
http://www.slashlegal.com/showthread.php?t=64451&page=2

So far, from the above links. 1/3rd of the uplift value seems quite popular ... which would make you a very rich boy.

Fire_Fox

I would wait for planning permission to be granted, and then pay for a professional valuation.

poppysarah

How much is the land worth and how much does the development lower the value of your own place? (If you've got a nice bit of open land there at the moment)

davz_2

many thanks for the info.

Holy cow! if i understand this correctly I could negotiate a third of the increase in the value of the land? The plots will be between 60k- 90k market value or about 2million for all of them and i need to be negotiating for 1/3rd value? Thats a lot of cash!

Does it also mean a third of the profits of the builder?

poppysarah

Put your house up for sale for something mad and see whether they bite. That way you don't have to live next door to a building site either.

googler

Is there any way that you can keep your strip of land, and (a) rent/lease/grant a right-of-way over it to the builder at first, then when the dev is complete (b) to the joint owners of the 22 houses, thus securing yourself a passive income for many years to come?

If not -

Do you want to live next to the building site, and later the 22 houses, with all their vehicular traffic, deliveries, bin lorries, etc going past what I assume is the end of your garden?

Is this the time to get the builder to buy your house including your land, and/or to suggest to him a revised planning application incorporating them (which may yield him a bigger profit at the end of the day)?

olias

Although tempting, I would be wary of being too greedy as the builder might just walk away and look for a less problamatic site leaving you with nothing.

I would strongly suggest getting proffesional advice over this and consider an agent as an intermediary. This would ensure the negotiations remain detached and businesslike and should help you secure the best possible outcome.

Olias