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Buying Land

You must take the same care when buying land as you would when buying a home. The most important point when buying land is to ensure that it has been approved for building and that the plot is large enough and suitable for the house you plan to build. When a plot of land has planning permission, the maximum size of building that can be built is usually stated. If you buy land from an agent, it will generally already have planning permission, but if it doesn’t it must be made a condition of purchase.

Some plots are unsuitable for building as they’re too steep or require prohibitively expensive foundations. Also check that there aren’t any restrictions such as high-tension electricity lines, water pipes or rights of way that may restrict building. Note that the cost of providing services to a property in a remote rural area may be prohibitively expensive and it must have a reliable water supply. Always obtain confirmation in writing from the local town hall that land can be built on and has been approved for road access. It’s also worth checking whether a plot is in an area where there are high levels of radon gas or other problems such as subsidence – see Home Check (www.homecheck.co.uk) or Enviro Search (www.envirosearch.com).

Most builders offer package deals that include the plot and the cost of building a home. However, it isn’t always advisable to buy the building plot from the builder who’s going to build your home, and you should shop around and compare separate land and building costs.

Obtain a receipt showing the plot is correctly presented in the land register and check for yourself that the correct planning permission has been obtained (don’t leave it to the builder). If planning permission is flawed you may need to pay extra to alter the building or it may even have to be demolished!

Cost of Land

The cost of land in England varies considerably depending on the area, e.g. from around £250,000 to £500,000 for a half-acre plot. Prices have escalated sharply in recent years in many areas, fuelled by the demand for new homes. As a rough guide, you should allow 25 per cent of your total budget for the cost of a plot and 75 per cent for construction. This means that if your budget is £250,000 you will need to buy a plot for around £62,500, which is difficult or impossible in most areas. However, you can save money on the construction by building a timber-framed home and doing some of the work yourself. Land can represent up to half the cost of building a home, although it’s still possible in many areas to buy a plot of land and build a bigger and better home for much less than the cost of a property built by a developer or a resale property.

Prime sites are at a premium in many areas and many old homes on a large plot are purchased by developers who knock them down and build a development of apartments, townhouses or detached homes. One way for self-builders to save money is to buy a plot of land with a derelict building on it and divide the land into two (or more) smaller plots and sell one to recoup some of the cost. Alternatively you can buy a house with a large garden and use half or more of the garden to create a new building plot and sell the house with a smaller garden. This way you can even get your plot for free if you add value to the house before selling it, but you must ensure that the garden isn’t too small or will be overlooked by your new house. You must also ensure that your plot has planning permission, separate road access and parking, and that your planned house doesn’t overlook nearby homes.

Plotfinder (01527-834435, www.plotfinder.net), a service of Homebuilding & Renovating magazine (01527-083 4400, www.homebuilding.co.uk), Build It magazine (020-7772 8300, www.buildit-online.co.uk) and Buildstore (www.buildstore.co.uk/findingland) are good sources of plots for sale. Homelands of England (01572-822111) sell building plots ready for building with planning permission, telephone lines, electricity, water, mains gas and drainage (called serviced land).

© Survival Books Limited 2005

“Buying, Selling & Letting Property” 2nd Edition, David Hampshire.
Reproduced with the permission of Survival Books Limited.

Further information on this topic can be found in “Buying, Selling & Letting Property” 2nd edition, by David Hampshire.

For extensive, annually updated information about buying, selling and letting property, you can purchase this book at www.survivalbooks.net

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