Vendor retaining ransom strip?

mollythewestie

We were looking on Right Move last night and noticed this:

"The property will be sold with the owners retaining a ransom strip around the curtilage."

on this listing - http://www.rightmove.co.uk/property-for-sale/property-37016452.html

It's not something I've come across before. Am I correct in thinking if you wanted to develop the land to the rear of the property you would need permission of the previous owner?
And is this a normal practice to retain strips of land around property?

Many thanks in advance!

JQ.

Yep, quite common where there's future development potential and the vendor is switched on.

The alternative is that the property is sold with a legally binding condition that the vendor gets x% of the uplift in value should planning consent be granted for a scheme.

Richard_Webster

The alternative is that the property is sold with a legally binding condition that the vendor gets x% of the uplift in value should planning consent be granted for a scheme.

And if that happens the buyer has to pay SDLT on completion of his purchase on a reasonable estimate of the likely extra amount payable by the buyer if planning permission is obtained, even though no permission has yet been obtained!. If the condition is set to run for so many years then at the end of the period if the permission has never been obtained the buyer can claim back the excess SDLT! So having a ransom strip avoids this SDLT nasty!

JQ.

Richard_Webster wrote: »

And if that happens the buyer has to pay SDLT on completion of his purchase on a reasonable estimate of the likely extra amount payable by the buyer if planning permission is obtained, even though no permission has yet been obtained!. If the condition is set to run for so many years then at the end of the period if the permission has never been obtained the buyer can claim back the excess SDLT! So having a ransom strip avoids this SDLT nasty!

But developers prefer overage clauses as it gives them certainty when calculating the value of a site - they know exactly what they need to pay to secure the scheme. It's often very difficult to second guess the motivations of a ransom strip owner - if they want to, they can totally frustrate any future development, removing all development value. As such developers will allocate a significant discount if looking a scheme with a ransom strip. So whilst creating a ransom strip may save money in the short term it will generally cost more in the long term.

Architecturaltechnologist

Hi all, Ive been going back and fourth with a very slow solicitor on this and would appreciate some advice..

we are about to sign contracts on our first home and we are aware of a 1m x7m ransom strip within our site location boundary along the back perimeter of the garden fence. (house backs onto open field). We fully understand why there is a ransom strip but we want know: "Has any rent been paid to the original land owner for the ransom strip in the past (we know the answer is no as the previous owner didn't know there was a ransom strip!) and what protection is in place for us as buyers of the property against future claims of rent?

Does anyone know if it common place to charge rent for a ransom strip?

Thanks in advance!

jbainbridge

You should start a new thread for this.

How can it be 'within' the boundary??