plot Assessing a self-build
Last month we offered a broad overview of the plot buying process, now we’re focusing on the details, starting with the vital job of assessing your plot’s potential
Last month I explained how to buy a building plot and went on to set out the process that should be followed to make sure you don’t buy a dud. Over the next few months I’ll be offering a more detailed look at key aspects of plot appraisal, with the goal of laying out the correct method for working out what a plot is really worth.
For whatever reason, over-enthusiastic plot buyers tend to skip over the appraisal stage. This can result in them overpaying for land that then throws up unexpected technical challenges, or worse, has planning complications that stand in the way of the hapless self-builder building their dream home. Carrying out a comprehensive plot appraisal is therefore vitally important if you are to secure an appropriate piece of developable land for a reasonable price. This process has three main steps: l assessing planning potential l assessing construction risks l calculating the plot’s value based on your findings.
This month we’ll be looking at the first of these points.
Land will either come with a consent in place or it will need planning permission to be secured — we covered how to buy land without planning permission in some detail last month. While existing consents offer less planning risk, they are not without their potential pitfalls. There is a question regarding whether the approved design will suit your needs, and the answer will not always be obvious. Therefore, in both cases, it’s a good idea to have a planning professional look over things.
We could leave things there of course — always use a professional. However, it’s worth explaining the questions a planner will be working to answer when they appraise your plot so you know what to expect and you can work with them and plan your own course of action accordingly.
Assessing the existing planning consent
There are a number of key questions to answer when assessing the existing planning consent, including:
DOES IT SUIT MY NEEDS?
We all have our own design aspirations, so an existing consent is unlikely to be a perfect match and you’ll need to figure out whether the approved design meets your needs. If it does not, amendments may be required, which may involve reopening debates that have already been chewed over during the original application. Fortunately, most consents aren’t architecturally controversial; changing the design will usually be possible, provided your alternative proposals fit with the street scene and won’t impact negatively on neighbouring homes. However, if you hope to build a three-storey house, but the neighbouring properties are bungalows that will be overshadowed and harmed by your proposal, beware, the most you’re likely to squeeze out of the plot could be a dormer bungalow.
WHAT TYPE OF PERMISSION HAS BEEN ISSUED?
Depending on how a planning application was made, the permission granted will be either an outline or full consent. Outline planning consent grants permission in principle but does not fully define the design of the house and will still require significant design development and further approvals. A full planning consent grants permission for a home with detailed design subject to certain specified conditions and allows work to commence as soon as those conditions are resolved.
WHEN WILL THE PERMISSION EXPIRE?
Most planning consents automatically expire three years from the date they are granted. As such, you should check that any planning consent granted to your potential plot isn’t going to expire before you can make a ‘material start’ on site.
When considering a plot with planning consent, make sure all the associated conditions can be satisfied and factor the cost of doing so into your valuation
A material start means commencing development and therefore enacting the consent, securing permission to build the approved home in perpetuity.what constitutes a material start is a matter of opinion, so you should always clarify with the LPA (local planning authority) concerned. If there’s a risk of the consent expiring before you take ownership, ask the vendor to renew the consent or make a material start themselves.
WHAT PLANNING CONDITIONS HAVE BEEN SPECIFIED?
When considering a plot with planning consent, make sure all the associated conditions can be satisfied and factor the cost of doing so into your valuation. Planning conditions, the small print that allows a consent to be issued while leaving the finer details for later, can be a double-edged sword; they are undoubtedly helpful in enabling a consent to be issued, but sorting them out adds time and expense to the associated project. Some even require resolution before work can commence.
Conditions commonly include stipulations on the planned building’s position, external materials and landscaping design and boundary treatments. Other planning conditions, however, such as ecology management, archaeology investigations and provision for safe access (covered below), can have a big impact. It’s essential that you make sure the planning conditions are capable of being satisfied and understand the cost involved so that it can be reflected in the price for the plot.
Plot constraints to consider
The conditions dictating what can be built, at the minimum, will incur costs to resolve that should be reflected in the plot’s value. Costly planning constraints can include:
HIGHWAY REQUIREMENTS AND SAFE ACCESS
The provision of visibility splays, clear sight lines for drivers turning out of
driveways or access roads,* is a common planning condition. Unfortunately, forming them on site isn’t always straightforward — it may not even be possible. It’s important to work out what it will take to fulfill safe access conditions such as this and make sure the land required is within your ownership. If it’s not, then at the very least you should have a legal agreement to make use of it for the purposes of visibility.
ECOLOGY
The planning process sometimes requires ecology reports that make recommendations about how protected flora and fauna should be managed and what should be done before construction work can commence. Depending on what the ecology surveys find, costs may be incurred, and these should ideally be reflected in the purchase price. Not all ecology is protected — invasive plants such as Japanese Knotweed might require costly treatments to eradicate.
If trees could be affected by the proposed building there will likely be a planning condition requiring measures to protect them during construction.
ARCHAEOLOGY
Sites of historical interest may need to have an archaeological study to determine their importance.where the archaeology is not fully understood a watching brief may be required while excavations take place.this could be expensive so, again, make sure the costs are reflected in the value of the plot.
PLANNING OBLIGATIONS
Planning obligations are the taxes that must be paid to allow a new home to be built. One of the most onerous, at present, is the Community Infrastructure Levy (CIL), which imposes a fee determined by the local authority based on the scale of the development. Fortunately, self-builders enjoy a preferential position here, and have a right to claim exemption from CIL payments. This means that self-builders avoid a significant expense incurred by professionals, so in theory they could offer more for the plot. This depends on the self-builder correctly following the notoriously fiddly and strict exemption process, of course. Don’t get caught out!
FLOOD RISK MITIGATION
Flood risk can be a plot killer. Even if a plot is in a residential area, a high risk of flooding may render it undevelopable. The environment agency is a standard consultee in the planning process and may object to any proposal where there is a risk of flooding. Ordinarily, the objection is removed once a flood risk assessment has been completed and proposals submitted to mitigate the risk.
Where things can go horribly wrong is where the appraisal identifies the location as high flooding risk (level 3). Here, the local planning authority may seek to implement what’s known as a sequential test which looks to move development to better, less risky locations.this means that if your desired plot is say a garden plot within the settlement boundary but subject to high flooding risk, the LPA may refuse permission.
And finally…
All too often, self-builders commit to projects without first understanding the cost involved and whether they can afford to complete the whole build. Before taking the plot any further, reflect on the planning appraisal and revisit the numbers to make sure it’s worth the asking price and fits your budget.
Assuming the outcome of the planning appraisal was positive, you should now be confident to invest some money in carrying out detailed surveys and investigations to assess the construction risk. Next month we’ll take a closer look at what this involves.