Land purchase negotiations

[biggles]

I’ve been approached by a neighbour about buying some land off him, a bit out of the blue so not really had time to think much about it, I’m interested if the price is right, I’ve told him to come back next week and we will try and thrash out a deal. I know roughly where I see it’s value, and the fact I’ll be expecting no uplift clauses etc on the sale, but I’m unsure what value to place on the bps entitlements, would I need these going forward ? Or would I be better off trying to leave them behind in the quest for a lower price? Is there anything else I should consider? Cheers

 

[happycows]

The Bps should not be much of a factor in decisions.
Entitlements are worth £130 per ha.
BPS Payments are not going to contribute any significant income towards it paying its way long term.

 

[Still Farming]

Buyer and seller legal fees ,land agent fees if needed etc

 

[Kidds]

While an uplift clause can affect the resale value to some extent it shouldn't be seen as an obstacle.
If there is any chance of the uplift being triggered you are in for a windfall as well as the original seller. If it isn't likely to be triggered in your opinion then just use it to lower the purchase price.
Just don't be the one to bring the subject up is my advice on that.

 

[Enry]

agree re uplift clauses - can make it more affordable and if it comes off then you're in a big win, if it doesn't you have saved a few quid

 

[designanddetail]

A lot of uplift clauses only become active when you sell the land/development on so if you didn't ever plan to sell then there would be no issue anyway.

 

[Tarw Coch]

Land next door is worth more to you than land down the road especially in a livestock situation where they can be walked there and are easily checked on.
Also you will usually only have one chance in a lifetime of buying it where it is, if you have any thoughts or intentions of buying land at some point in the future this may well be the best opportunity you’ll get.

 

[chipchap]

Make sure any uplift clause is time limited.

Be aware an uplift clause will lead to higher legal fees, for both sides.

My advice is to make an offer for the land and the entitlements as a package, but don‘t let it be a dealbreaker.

 

[No wot]

If you can afford it in one go , or the repayments and farming for the longterm the chances of buying on your door step will never be regretted what you agree on entitlements and up lift are not as important as the sale slipping through your hands

 

[Wombat]

As a few have said

It’s next door so worth more to you.
The entitlements could be about 1% of the deal so not really a consideration.
If you can keep it off the open market do as as soon as it’s public people with much deeper pockets may get involved.

 

[egbert]

compared to any other aspect, entitlements are the simplest to value...there's a national trade in what is a homogenous commodity

 

[Dragon]

Just be prepared to say quietly in your head "HOW MUCH". Then smile politely!!

 

[biggles]

Cheers for all the replies, it sounds like it’s all pretty much what I was expecting, hopefully we won’t be a million miles apart, I’m hopefull a deal can be done. Paying for it won’t be so easy though!!

 

[Mark C]

It’ll probably look cheap in 5 years so go for it.

 

[chipchap]

It’ll probably look cheap in 5 years so go for it.

And in twenty years it will probably be paid for too, if not before.

 

[Billboy1]

is he retiring? if so is he taking the lump sum therefore there won't be any entitlements

 

[biggles]

is he retiring? if so is he taking the lump sum therefore there won't be any entitlements

He’s not farmed for years and has just rented this ground out, I think it’s just a case of it’s the right time to sell as there’s changes a foot and he fancies a bit of the easy life

 

[Flat 10]

Fingers crossed for you

 

[case44]

Get it bought,I have only regretted the land that I didn’t buy.You can always sell some off in the future if needed.

 

[Formatted]

is he retiring? if so is he taking the lump sum therefore there won't be any entitlements

Lump sum scheme doesn't start till 2022 and the incoming tenant/owner will be able to claim as normal. Read the consultation!!!