What to consider when selling part of your garden for development

10 key considerations and pitfalls when thinking about selling part of your garden to a developer or developing it yourself.

There is no doubt that the UK is a nation of garden lovers, but there can be a point where your garden is perhaps too large to cope with or not really used and if you are attached to the house and it is in a popular area then that knock on, or letter through, the door from a developer offering to buy or develop your plot can be appealing for a range of reasons, not least the prospect of unlocking some cash. Alternatively you may decide to build the house yourself on part of your garden and then sell it. The aim of this article is to highlight some key considerations and some potential pitfalls to assist those considering this step.

1. What will it mean for your house?

Do not underestimate the impact the new dwelling will have on your retained property, particularly during the building process but then in terms of ongoing noise and presence. Once you sell the plot bear in mind you will lose control of it and you have to be prepared to tolerate some degree of disruption and loss of privacy. Clearly building a plot yourself for a family member is a more attractive prospect.

2. Where will the access be?

Consider where the access points will be to both properties and how maintenance arrangements will work in future. Also beware of the prospect of a developer buying your plot and then later buying land behind or adjacent to build more housing and your plot ends up being the access to many more properties than you were expecting. In this situation it may be far better to hang on to ownership and grant a right of way over the access road.

3. What about your neighbours?

Be aware of the impact the sale could have on relationships with your neighbours, who may be upset about the plans as their view may be affected and traffic increased. They may also decide to object to the planning application which does not help you or the developer. It is advisable to consult with neighbours before any steps are taken and get their views to deal with concerns at an early stage.

4. Restrictive covenants

Consider whether you should impose a restrictive covenant on the plot you are selling to ensure that the developer does not build a larger house than you were expecting or try and extend it in future. This may be difficult to negotiate but if you are staying in the house adjacent to the plot then it is worth a go.

5. Will it affect the value of your house?

Whilst outside the scope of this article and I am not a valuer you should take advice on the likely impact of any sale on the value of what remains of your house and whether it will be more difficult to sell. Although you are profiting from the sale of the garden you need to be prepared for a potential loss in value in your home which may have a bearing on other aspects of your life including potential equity release, funding of care costs or inheritance considerations.

6. Take advice

If you are building the house yourself make sure that you employ good planning consultants and architects to help you with the design and planning approval process. Unless you are an expert in these areas, the process can be difficult and stressful and far better to hand over responsibility to people who deal with these matters every day. If you sell the plot to a developer then make sure they disclose full plans to you before the sale so you understand what the new house will look like and the impact on you. You can also ask to approve the planning application before it is submitted.

7. Approve the plans

If you sell the plot to a developer then make sure they disclose full plans to you before the sale so you understand what the new house will look like and the impact on you. You can also ask to approve the planning application before it is submitted.

8. No early access

Remember to never allow a developer to start any work on the garden until they actually own it. Otherwise there is a risk that any planning permission is implemented while you are the owner which means you are liable for any breaches of the permission and also if something goes wrong with the developer and they stop work, you will be left with a parcel of land which needs to be cleared and cleaned up and this cost would fall to you.

9. Is the price fair?

Make sure that the price you agree to accept is fair and represents proper market value. Consult with a local estate agent if in doubt.

10. Tax

Bear in mind any tax consequences of selling part of your property and ensure that you understand these before you complete the sale.

Selling part of your garden is often a sensible solution as it enables you to stay in your own home but get a cash return for part of your garden which you are not going to use so it should be a “win win”. Provided you follow a few rules and ensure you properly consider the consequences before committing yourself then it should be a positive experience and outcome for all concerned.

Guest article by Ben Tarrant of Thrings Solicitors