Selling land to a builder, help needed please.

martindow

OP you need to answer Holly's question in post 3. You can't sell off bits of land devaluing your property without involving your lender if you have a mortgage.

If you are free to sell, as well as negotiating the price I would ask the buyer to foot all of the legal costs involved.

sammyjammy

They did answer it in post 5! There is no mortgage

[Deleted User]

You're looking at doing a business deal, remember if it's not in the contract it isn't going to happen. The fact that B2 can't afford to buy the land now is not a good sign, when someone can't afford to pay upfront but promises double the going rate later alarm bells should be ringing.

"He thinks our plot is important as it would stop builder 1's development."

If he pays you £1000 for the option to purchase the land for the next 24 months he has prevented B1 from building, when the option period is coming to an end and B1's project has fallen apart do you think he's going to come back to you and offer £60k when you have nobody else interested in buying? Nope! He's going to offer you peanuts.

Take £30,000 today, either from B1 for the land or from B2 as a deposit on the full purchase that requires the final £30,000 payment to be made in 24 months. You can't lose that way.

If B2 can't afford to spend £30,000 today on something essential to his project, he's not going to be able to afford to build his project. This could even be one big power play against a rival builder, after all £1000 is chicken feed compared to the money he could cause B1 to lose.

zzzLazyDaisy

You have heard the saying 'a bird in the hand is worth two in the bush'? There is a reason for that.... the birds in the bush could fly away at any time and there is little real chance of catching one of them, let alone two!

Buyer 1 is a serious buyer. He knows what he wants to do with the land and your land is an integral part of those plans. You will end up with one large home which means only one new family for neighbours. You will be able to negotiate with this builder on additional issues - for example you may wish to agree that the new building should only be a one storey bungalow so they cannot overlook your house and garden, if this is an issue (I know someone who did exactly that). You may also wish to agree that the builder is responsible for putting up a boundary wall or fence of specific height to ensure privacy). You can also make searches to see how much similar plots of land have sold for in the vicinity, to ensure the price offered is fair.

Builder 2 is not a genuine buyer at the moment - and may never be a genuine buyer. They don't 'need' your land for their project, they just want to ensure that Builder 1 can't use it for their project. The £1000 option to purchase achieves this object with very little outlay. The rest is, frankly, pie in the sky. My attitude would be that either they wish to buy the land from you now and make a sensible offer, or they can walk away.

At this moment the deal is, do you accept £30k to allow builder 1 to build his house, or do you accept £1k to stop builder 1 from building his house. There is no other offer on the table.

Don't allow greed to get in the way of common sense.

georgiac

Many thanks everyone.

I have come to the conclusion ( with all your help) that we should take the cash offer as builder2's offer may never materialise.

I think the pound signs in front of my eyes were blinding me from seeing the obvious.

Thanks for all your advice

ognum

An option is just that, a possibility that he will buy it is by no means definate, he is hedging his bets.

If you want to sell take the first guys cash

[Deleted User]

georgiac wrote: »

I have come to the conclusion ( with all your help) that we should take the cash offer as builder2's offer may never materialise.

congratulations on the windfall

zzzLazyDaisy

georgiac wrote: »

Many thanks everyone.

I have come to the conclusion ( with all your help) that we should take the cash offer as builder2's offer may never materialise.

I think the pound signs in front of my eyes were blinding me from seeing the obvious.

Thanks for all your advice

Congratulations and enjoy your good fortune :-)

patman99

Hope you have considered how unpopular you will become with all the neighbours who don't want a large house overlooking their gardens and so will object to the plans.

Davesnave

patman99 wrote: »

Hope you have considered how unpopular you will become with all the neighbours who don't want a large house overlooking their gardens and so will object to the plans.

I hope you have considered that you don't really know that.