The price of land....

HAMISH_MCTAVISH

So here is a plot of land, with outline planning permission for a 3 bed detached house, within an easy 45 minute commute of Aberdeen.

http://www.aspc.co.uk/cgi-bin/public/SEARCH/ID?ID=281901

The price is £30,000.

Which funnily enough is almost exactly the average price that big builders are paying for plots of land. (£33K)

If I were to contract with a builder to build that house, I'd get a 160 sq metre detached built for around £160,000. On top of that I'd need to pay for planning and building warrant fees, architect designs, utility connections, sewage/septic tank, driveway, landscaping, and of course all internal fixtures and fittings such as carpets, kitchen, bathroom suites, etc.

The total cost would be in the region of £220K.

If the price of land fell by 50%, the total cost would be in the region of £205K.

Perhaps someone would like to explain how it is that the price of land falling would result in double or triple the number of houses being built as are today?

Or is it the case that the main obstacle to house building is in fact the mortgage famine, not land prices, as almost everyone except a few die-hard crashaholics now accepts is the case.

grizzly1911

HAMISH_MCTAVISH wrote: »

So here is a plot of land, with outline planning permission for a 3 bed detached house, within an easy 45 minute commute of Aberdeen.

http://www.aspc.co.uk/cgi-bin/public/SEARCH/ID?ID=281901

The price is £30,000.

Which funnily enough is almost exactly the average price that big builders are paying for plots of land. (£33K)

If I were to contract with a builder to build that house, I'd get a 160 sq metre detached built for around £160,000. On top of that I'd need to pay for planning and building warrant fees, architect designs, utility connections, sewage/septic tank, driveway, landscaping, and of course all internal fixtures and fittings such as carpets, kitchen, bathroom suites, etc.

The total cost would be in the region of £220K.

If the price of land fell by 50%, the total cost would be in the region of £205K.

Perhaps someone would like to explain how it is that the price of land falling would result in double or triple the number of houses being built as are today?

Or is it the case that the main obstacle to house building is in fact the mortgage famine, not land prices, as almost everyone except a few die-hard crashaholics now accepts is the case.

Depends where the land is - 45 minutes commute to Aberwhere?.

1245sqm ~ 0.30 acre AUIU.

Residential Development Land for Sale in OX15 5RQ

Guide Price: £250,000
Size: Approx 1/3 Acre
Land Type: Residential Development
Planning Permission: No Planning Permission
Land Designation: Brownfield


http://www.uklanddirectory.org.uk/land-for-sale.asp?id=17196

chucknorris

HAMISH_MCTAVISH wrote: »

So here is a plot of land, with outline planning permission for a 3 bed detached house, within an easy 45 minute commute of Aberdeen.

http://www.aspc.co.uk/cgi-bin/public/SEARCH/ID?ID=281901

The price is £30,000.

Which funnily enough is almost exactly the average price that big builders are paying for plots of land. (£33K)

If I were to contract with a builder to build that house, I'd get a 160 sq metre detached built for around £160,000. On top of that I'd need to pay for planning and building warrant fees, architect designs, utility connections, sewage/septic tank, driveway, landscaping, and of course all internal fixtures and fittings such as carpets, kitchen, bathroom suites, etc.

The total cost would be in the region of £220K.

If the price of land fell by 50%, the total cost would be in the region of £205K.

Perhaps someone would like to explain how it is that the price of land falling would result in double or triple the number of houses being built as are today?

Or is it the case that the main obstacle to house building is in fact the mortgage famine, not land prices, as almost everyone except a few die-hard crashaholics now accepts is the case.

Is it in the middle of nowhere Hamish? What would you anticipate the finished house being worth? Are services nearby?

To put it into perspective I looked at a plot last month for 335k with PP for 4 bed house (postcode RH4).

EDit: if it had not been on road with (IMO) too much traffic noise I would have bought it.

dryhat

If I lived up there I would buy it and build a huge block of flats.

Then, according to the laws of supply and demand, I would cause a price crash in the area.

Gin and tonics all round.

shortchanged_2

OK Hamish if it's not the plot price that affects the cost of a house, the question to be asked, why does it cost phenomenally more to build a house these days than say 12 or 13 years ago?

Because I bet back then you could have built the same spec house for half the price.

So all this goes to show there is something fundamentally wrong with the house building market.

Graham_Devon

You could fit about 10 detached houses on that.

Silly boy.

If I were to contract with a builder to build that house, I'd get a 160 sq metre detached built for around £160,000. On top of that I'd need to pay for planning and building warrant fees, architect designs, utility connections, sewage/septic tank, driveway, landscaping, and of course all internal fixtures and fittings such as carpets, kitchen, bathroom suites, etc.

The total cost would be in the region of £220K.

If the price of land fell by 50%, the total cost would be in the region of £205K.

House with a massive garden then?

marathonic

The cost of building materials has shot up significantly since the start of the recession.

In my area, it's cheaper in most regions in the city to buy than to build - even if you got the land for well below it's current 'supposed' value.

For example, I bought a 1600 square foot detached house for £115,000. I'd imagine the cost to build if it was a bare site would be very similar. My house was originally built in 2007/8.

The only area in the city here where it's worth buying land is the really upmarket areas. It may then be worthwhile to build because the cost of the site wouldn't represent such a large percentage of the value of the house when complete.

shortchanged_2

marathonic wrote: »

The cost of building materials has shot up significantly since the start of the recession.

In my area, it's cheaper in most regions in the city to buy than to build - even if you got the land for well below it's current 'supposed' value.

For example, I bought a 1600 square foot detached house for £115,000. I'd imagine the cost to build if it was a bare site would be very similar. My house was originally built in 2007/8.

The only area in the city here where it's worth buying land is the really upmarket areas. It may then be worthwhile to build because the cost of the site wouldn't represent such a large percentage of the value of the house when complete.

So was it really expensive to build in 2004 -2007 then?

grizzly1911

160sqm ~ 1722sqft

According to this link a typical house as suggested by HMT would be built on 0.10 of an acre. I would suggest this is bigger than the typical average so that would value average land at say £360k+ acre (33k/plot), whereas HMT example is £90K or 9k for the typical plot (sealed bid probably higher) and the Oxfordshire example I posted at £750k.

Apples, pears and passion fruit.

http://www.buildstore.co.uk/findingland/Plotsizeexamples.aspx

the_flying_pig

i somehow don't feel the need to check the numbers to proclaim this a thoroughly stupid thread.

marathonic

shortchanged wrote: »

So was it really expensive to build in 2004 -2007 then?

I'm not sure. I bought it two months ago. I know that it was on sale in 2007/8 for £250,000 but didn't sell so was rented out.

I bought it off the developer after the previous tenants moved out for £115,000.

FYI, it's in Northern Ireland where prices have crashed significantly.

I do know that it would have costed less to build then than it would now due to the rise in the cost of materials since 2007/8.

Sites in the area are around £45,000. I know for a fact that I wouldn't be able to build my house for £70,000.