Would like to buy land next door-probably can't afford it

[davidpstock]

Our neighbour is thinking of either selling their house (which is on a double sized plot) as is, or selling half their plot (adjacent to us) as land with building approval. We are thinking of moving anyway but not for about 5 years, and by then there could be another house between us which will affect our value. In an ideal world we would buy the plot and sell when we move, but can't afford the 75-100k valuation of the plot.
Any ideas on raising the money? A mortgage is only for an already built house isn't it?

[sidicks]

davidpstock said:

Our neighbour is thinking of either selling their house (which is on a double sized plot) as is, or selling half their plot (adjacent to us) as land with building approval. We are thinking of moving anyway but not for about 5 years, and by then there could be another house between us which will affect our value. In an ideal world we would buy the plot and sell when we move, but can't afford the 75-100k valuation of the plot.
Any ideas on raising the money? A mortgage is only for an already built house isn't it?

Remortgage your current house and use the cash raised to buy the land?

[davidpstock]

sidicks said:

Remortgage your current house and use the cash raised to buy the land?

We have just finished our mortgage, so would it be an equity release loan on our house?

[anonymous-user]

You could look at a self-build mortgage.

[Sharted]

davidpstock said:

We have just finished our mortgage, so would it be an equity release loan on our house?

Simple remortgage to raise the funds for the land.

[mdianuk]

Don't know your area, but if £100k + £200k build for a modest 4 bedroom house would yield a much larger sell price, buy it and speak to your bank about a self-build mortgage.

[98elise]

Sharted said:

davidpstock said:

We have just finished our mortgage, so would it be an equity release loan on our house?

Simple remortgage to raise the funds for the land.

This, thats how we bought our first BTL.

One thing to be aware of if you buy the plot, the permission will lapse in 2 years (IIRC) and the is no guarentee that it would be approved a second time. You might be buying a very expensive garden.

[was8v]

If you plan to move in 5 years, then get permission and start digging footings just before the deadline for work to start- usually 3 years.

I'm not 100% sure but I think there is no time limit to completing the build.

Anyone who buys the plot off you can finish what you started or re-apply for something else.

[tighnamara]

davidpstock said:

Our neighbour is thinking of either selling their house (which is on a double sized plot) as is, or selling half their plot (adjacent to us) as land with building approval. We are thinking of moving anyway but not for about 5 years, and by then there could be another house between us which will affect our value. In an ideal world we would buy the plot and sell when we move, but can't afford the 75-100k valuation of the plot.
Any ideas on raising the money? A mortgage is only for an already built house isn't it?

Would you selling the land for a house not have a similar affect on the value of your house as having a house built next to you.
Not sure how purchasing and selling as a plot will protect your house value if you think it will be affected by a house being built next door.

Would it be worth purchasing the land and selling along with your house ?

[Jag_NE]

what sort of value is your current home? the reason I ask is that if it is a relatively normal property, the addition of another close by may not have a major impact on its value. if it is something quite special, vice versa. i would want to be absolutely sure that if i bought the plot there would be no risk of it losing any value in the future, aside from general market movements.

[davidpstock]

tighnamara said:

Would you selling the land for a house not have a similar affect on the value of your house as having a house built next to you.
Not sure how purchasing and selling as a plot will protect your house value if you think it will be affected by a house being built next door.

Would it be worth purchasing the land and selling along with your house ?

Thing is we know that if our neighbours sell the plot, the value of our house will decrease by some amount- but obviously not by the amount the land will cost-if we bought it we would sell it at the same time as our house. Even if we broke even on the land, we hopefully wouldn't lose the house value decrease as there wouldn't be a new house next door yet.
Ideally we should just sell now before anything happens.

[curley]

Whereabouts in the country is this ?

[davidpstock]

curley said:

Whereabouts in the country is this ?

Leicestershire

[Sarnie]

Forking out a significant amount to buy something in the hope of only breaking even doesn't seem like a great idea to me?

[Hoofy]

davidpstock said:

Thing is we know that if our neighbours sell the plot, the value of our house will decrease by some amount- but obviously not by the amount the land will cost-if we bought it we would sell it at the same time as our house.

Would potential buyers not be put off by seeing a plot next to you looking ripe for development and thus the price of your house be affected anyway?

Can you integrate the land as part of your own ie a huge garden that runs down the side and into the rear? Fence off the front end and convert the front half into an extension of your drive.

[tighnamara]

davidpstock said:

Thing is we know that if our neighbours sell the plot, the value of our house will decrease by some amount- but obviously not by the amount the land will cost-if we bought it we would sell it at the same time as our house. Even if we broke even on the land, we hopefully wouldn't lose the house value decrease as there wouldn't be a new house next door yet.
Ideally we should just sell now before anything happens.

No there wont be a new house next door but there will be plot of land that is marked for a house next door.
Why do you think the house value would hold up if you bought and sold the land, would it not have the same affect as you are thinking it has at the moment.
Presuming your thoughts are that there is not yet any house built thus no affect on property value, that may be the case but I would presume anyone purchasing your property is going to ask / find out about the land adjacent and that legally you may have inform the purchaser that it is owned by yourself.

It may be that what was said previously above is correct and that there will no affect on your property value with a house built on the said plot, may be worth taking some professional advice if you are thinking of such drastic measures to try and protect yourself.

[CarlosFandango11]

Sarnie said:

Forking out a significant amount to buy something in the hope of only breaking even doesn't seem like a great idea to me?

The alternative is to suffer a reduction in the value of their property. Which would be worse than breaking even.

[xstian]

What would put you off buying a house the most? A place with a newly built house next door or a place that is about to have a building site start next door?

[Sarnie]

CarlosFandango11 said:

The alternative is to suffer a reduction in the value of their property. Which would be worse than breaking even.

A perceived reduction in the value of their property....

[davidpstock]

Sarnie said:

A perceived reduction in the value of their property....

I'm pretty sure the value will reduce,a new house next door can't do us any favours. If we buy the land and extend our garden the value certainly won't increase as much as the land cost.