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Last edited 22 Oct 2020
Land acquisition is the process of buying a piece of land. The motivation behind land acquisition can be varied; perhaps as an alternative investment to shares, as the starting point for a self-build project, to develop at a later date, and so on.
The cost of a plot of land depends on factors such as; the desire of the vendor to sell, location, size, form, accessibility, proximity to infrastructure and transport links, the general state of the property market, whether it has or is likely to receive planning permission and so on. The term 'existing use value' refers to what land is worth in its current form, whereas 'hope value' refers to what it is worth based on the expectation of getting permission for development. Generally, land that has planning permission for development has a higher value than land that does not.
Land acquisition methods include:
- Through a consent-based obligation: A gift, settlement of a trust, contract agreement, and so on.
- Resulting or constructive trust: Acknowledges the contribution (financial or otherwise) that an individual has made to the land and/or property on it.
- Assurance: A claim of proprietary estoppel is a way for people to acquire rights in land if dealings with a landowner have fallen short of a contract.
- Adverse possession: A claim of a right in land if it has been inhabited long enough. If a person has been in possession of land for 12 years, they may be able to acquire legal title to it.
- Compulsory purchase: Making it available for public works such as building infrastructure, utilities or housing developments.
Options for finding land to acquire include:
- Offering a finders fee.
- Online search tools and forums.
- Specialist land agent or estate agent.
- Approaching owners of land designated for residential use in local development plans.
- Analysing aerial photography and large-scale maps which might reveal potential infill plots, such as; large back gardens, waste ground or brownfield sites.
- Poorly built, low-value properties that might be worth purchasing for their land value.
- Local developers who may have individual plots for sale.
- Land auctions.
- Local authorities who may have parcels of land they are prepared to sell for development purposes.
- Utility companies may have surplus land that is for sale.
- Private enquiries to private homes, for example, which may have large gardens that the owners are willing to sell for development purposes.
A legal professional should be appointed to oversee land acquisition, although in general, purchasing land is less complicated than the buying and selling of property. Nevertheless, a lawyer specialising in land transactions will be able to ascertain issues relating to permissions, boundaries, rights of way, right to light, noise issues, and so on. They will also be responsible for checking that the land has clear title (i.e. that it is legitimately for sale), and that the legal documentation relating to the site is accurate and correct.
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