What to do with land?

[phn]

Hello there any real estate tycoons out there can help me with the below questions?

I have seen an interesting bit of land come up for sale. It's approx 2 acres, with a decent sized field and small area of trees bordering a stream. All in all a very picturesque plot. I would love to buy it as an investment for our family, and for leisure purposes, as it's (sort of) within my budget. The snag is there is no planning permission on the land, as it's advertised for agricultural use only.

The thing is, I am not sure how much (if at all) the land would go up in value given the restrictions on development etc. Also I was wondering what expenses might be involved in the maintenance of such a plot?

Further, I was wondering if there were any other ways the land might be able to earn its keep, as well as any investment potential?

If anyone can help with the above, I would be happy to hear from you!

Thanks,

Philip.

[monthefish]

phn said:

The snag is there is no planning permission on the land, as it's advertised for agricultural use only.

The thing is, I am not sure how much (if at all) the land would go up in value given the restrictions on development etc.

Very little I'm afraid. Do not buy this land as investment.

Buy the land if it is of use to you now, but don't think of it as much of an investment.

You could play the strategic long game that in 20 years (and 3 'local develoment plans') later the land may be designated differently, but you need to be realistic about whether this is likely based on where it is and what surrounds it. It would be a big gamble to buy it solely for this, but if you're buying the land for other reasons i.e. to use 'as is', then it's not really a gamble (and you may get lucky).

In terms of costs of maintenance, I suppose it depends on how well kept it is at the moment, and whether the local authority are likely to insist on it being maintained to that standard. You say it is 'picturesque' which may affect this.

Paying for itself - well if it is designated for agricultural use, then there's your answer - advertise for a place to graze horses perhaps? Another benefit to this would be you may get consent for a nice horsey barn/stable type building, which could then potentially be converted at a later date, but again this is not likely to be easy, nor feasible in the short term.

[netherfield]

Over a period of time land has never been known to lose value,as to planning,you could hang on for the rest of your life and still be refused.

I would think £50/£60 per acre a year is as much as you could earn from grassland from a farmer.

Horses could be the way to go,small plots are what horse owners are looking for,you would need to check if this would be allowed,not always classed as agriculture.

[monthefish]

netherfield said:

Over a period of time land has never been known to lose value

Although probably not relevant to the OP's situaion, the above isn't true.

Development land that has a nice open outlook across some fields.
Next iteration of local plan designates fields as site for local authority housing/business park/retail park etc etc.
What do you think happens to the value of the development land?

(I've seen this happen BTW).

[phn]

Thanks for the interesting replies - If anyone with a horse is reading this - what do you pay for grazing land?

[richyb]

Depending on soil conditions you could plant it up as forestry. At forestry spec you could put 2000 conifers on it or maybe a coppice woodland. Not a lot of money in it but as a long term family thing could be something interesting.

[phn]

Like the idea of planting woodlands - I feel a spot of internet research coming up....

[tobeee]

phn said:

Thanks for the interesting replies - If anyone with a horse is reading this - what do you pay for grazing land?

It would need mains water (don't think the stream would be good enough!). if it doesn't already have mains supply, that could be tricky to get.

[Simpo Two]

tobeee said:

It would need mains water (don't think the stream would be good enough!). if it doesn't already have mains supply, that could be tricky to get.

He could hire my cousin's stream. The horse goes in a treadmill to generate electricity and they share the profits!!

[russ_a]

I would plant a load of Christmas Trees.

[B17NNS]

Simpo Two said:

He could hire my cousin's stream. The horse goes in a treadmill to generate electricity and they share the profits!!

[Oi_Oi_Savaloy]

In answer to your question about land values - about £3,500-£,000 per acre for grazing land, £7,5000 + per acre for farm land. I've heard of land (in Pembrokeshire, Grade 1) going for upwards of £12,500 per acre however (usually a large parcel of land, well located, attracts SFP funding etc etc).

If it has a sniff of development potential however then things become a little more interesting.

Pm me if you want.

[JQ]

I don't agree with many of the posts above I'm afraid. Agricultural land is a reasonable long term investment and values have dropped very little in the past 3 years in comparison to commercial or residential investments. There are now several investment funds actively targeting agricultural land for future capital growth. After all land in the UK is a finite resource.

It won't make you a fortune, unless you can get a change of use, which sounds quite unlikely from your description. But you may receive a small income whilst gaining some capital growth in a secure investment.

Of course all of the above relies on you not paying over the odds in the first place - which is often where many people fall down. All those people buying house sized plots on larger development sites with the hope of future residential planning consent are generally paying 10 times the market value of the land - they're never going to see a return, unless they can persuade another mug to part with their cash.

If you are wondering what to do with it, first port of call should be the local planning officer - find out what uses they would accept for the site. If they're not accommodating then speak to a commercial planning consultant about forcing changes through.

[Oi_Oi_Savaloy]

I agree with JQ - land prices (agri land I mean not resi) have consistently risen over time.

The big drivers in the market at the moment are farmers actively purchasing more land and funds/investors looking to diversify their porfolios are investing in land. Farmers are buying as size really does matter (you can't make a 150 acre farm work these days). Plus the fact that banks are willing to lend too.

[phn]

Thanks for all the informative replies - pistonheads members are a versatile and helpful bunch!

I will do some research into land values as suggested. If it's got some investment value then I would definitely be interested.

[dave_s13]

russ_a said:

I would plant a load of Christmas Trees.

Now that is not a bad idea.

There's a farm near me does it and trees range from £20-40 each.

I have no idea how many he flogs but it must be feasible to get 100 out of the ground.

Thats circa 3k in yer hand for a couple of weeks work.

It may not be that simple though.....

[TimJMS]

Funny old thing, land. It stagnated it value between 1984 - circa 2000. Since the recession bit values have gone stratospheric. From decades of seeing a couple of grand an acre for average bare arable average values are now north of £7k an acre. But that's an entirely different sector. Small plots are impossible to value and those values depend entirely on local interest. The only way to really make it pay would be to grow and market your own veg / eggs /nursery stock / Christmas decorations etc via a web advertised home delivery service.'Push the sustainability angle, the zero air miles angle and any other trendy bks you can think of. You need to appeal to middle class eco guilt and turn it into cash

[richyb]

dave_s13 said:

russ_a said:

I would plant a load of Christmas Trees.

Now that is not a bad idea.

There's a farm near me does it and trees range from £20-40 each.

I have no idea how many he flogs but it must be feasible to get 100 out of the ground.

Thats circa 3k in yer hand for a couple of weeks work.

It may not be that simple though.....

As I mentioned earlier, forestry spec planting is 2500 trees per hectare. With 2 acres you could get nearly 2000 trees on the site. 7-8 years to grow them from a whip (which is the standard size you buy them in for from a nursery - at about 50p a go) to average christmas tree size. divide the site into 8 and you could have a yearly supply of trees. Not 250 trees a year though, you'd have to anticipate loses of around 10%. Prepping and bagging them will add to costs in terms of finished product but you could make a decent profit on it if you sold them yourself for £30 a pop. You can get a yearly grant from the forestry commission as well but for 2 acres it will be in the hundreds at best.

The maintainence involved is mainly weed suppression. Normally in commercial conifer forestry you spend the first 5-6 years keeping every other plant away either through cutting or with herbicide. You could easily spend a couple of weekends a month doing this in spring and summer.

[Kudos]

dave_s13 said:

russ_a said:

I would plant a load of Christmas Trees.

Now that is not a bad idea.

There's a farm near me does it and trees range from £20-40 each.

I have no idea how many he flogs but it must be feasible to get 100 out of the ground.

Thats circa 3k in yer hand for a couple of weeks work.

It may not be that simple though.....

minus cost of ground over the 3-5 years or whatever it takes to get them to that stage, baby trees (honestly can't remember the name), your time in cutting/selling, and not to forget mister tax man - no doubt he'll want a share somewhere!

[netherfield]

High rate of pilferage on Xmas trees as well.