Sell house with planning or sell plot separately

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Hi there. We have a 1930’s semi corner plot and have been granted outline planning (all matters reserved) to
build a 4 bed detached house on the side of the plot, which will be worth around £400k

This will involve demolishing the side extension of
our house (housing the kitchen) and returning our house to its original footprint.

Having spoken to some land auctioneers I think that we could
get around 150k if we sell the land with planning permission, but would obviously need to spend money demolishing the side extension, landscaping and moving the kitchen back inside (20k?)

I am trying to decide if I am better off doing this or selling the
current house with planning to a developer/builder and having them do all the work.

*Current house as is with side extension worth circa £375k
*Current House taken back to original footprint on smaller plot circa £330k

How much do you think I could get selling the current house with planning?

I guess I will make less this way but more likely to find a buyer as if splitting plots may be difficult to sell current house due to proposed building works on side plot?

Any other things I should think about?

thanks

Jamie
 

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Be careful if you decide to remove your extension and sell the plot for development.
A developer tried to buy a plot of land at the bottom of my elderly FIL's house. Told him he would buy the land after HIS surveyor had valued it and then pay him after he had built a few bungalows and FIL would get 1/3 the selling price of the first bungalow sold. FIL was happy with this arrangement as he knew builder wouldn't have the money to buy his land and then start building works.
Took a bit of time to get him to realise surveyor would under-value the land and the first bungalow would be 'sold' to a mate at cost price which he would then sell on at full market value. Thereby fiddling FIL out of potentially many, many thousands of pounds.

If you intend to move at some time in the future I would either hold on to the land or sell the whole lot, as is, lock stock and barrel.
Bear in mind, if you sell the plot alone, you risk devaluing the worth of your house because you will no longer have the land attached.

I think you need professional advice on this to be honest.
 
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Be careful if you decide to remove your extension and sell the plot for development.
A developer tried to buy a plot of land at the bottom of my elderly FIL's house. Told him he would buy the land after HIS surveyor had valued it and then pay him after he had built a few bungalows and FIL would get 1/3 the selling price of the first bungalow sold. FIL was happy with this arrangement as he knew builder wouldn't have the money to buy his land and then start building works.
Took a bit of time to get him to realise surveyor would under-value the land and the first bungalow would be 'sold' to a mate at cost price which he would then sell on at full market value. Thereby fiddling FIL out of potentially many, many thousands of pounds.

If you intend to move at some time in the future I would either hold on to the land or sell the whole lot, as is, lock stock and barrel.
Bear in mind, if you sell the plot alone, you risk devaluing the worth of your house because you will no longer have the land attached.

I think you need professional advice on this to be honest.
Thanks Connty, who is the best person to get advice from? Approached a local estate agent but they didn't want to come over to value at the moment as not ready to sell yet and they are v.busy.
 
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As part of the existing house needs demolition, I would be tempted to sell both plots together. The builder would be in control, and could choose to upgrade your property to maximise profit. The wise way forward however might be to market both alternatives

Having just dealt with a number of estate agents on a land sale, the differences in valuation were very significant. Do you know a builder/building surveyor/architect who could advise on any practical issues like access to services, ground works etc none of which an estate agent could factor in accurately. All could make a significant difference to cost and therefore selling price.

At the end of the day I would think it has to a guide price and sealed offers.

Blup
 
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Thanks Blub,

Architect has already done PP application and no problem with drains, services etc.

For the plot I think 150k is realistic as a smaller plot sold for this 3 or 4 years back in a less desirable area

Is it fair to assume that the value of the house with PP would be as follows:
£330k (value of current house on reduced plot) - £20k to (for demolition/landscaping) + £150k (value of land)?= £460K

Thanks

J
 
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The sequence looks about right but sometimes the purchaser wants an allowance for fees, maybe not on a small plot.

The other factor is capital gains tax and the private residence relief. There may be different implications depending on whether you split the the land off or sell as a whole.

This article is quite useful without being definitive.


Blup
 
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Thanks Nakajo- what do you mean by 'build out the permission'?
 
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…and the aggro! I was thinking along the lines of building a property on some land that we had got permission on until my wife reminded me that I still hadn’t painted the skirting boards in the room I had 'finished' decorating six months previous….
 

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