What planning permission does to the value of land
The ladder of value, the sum a developer works backwards from and why we show you ours.
The value ladder
Five rungs, each worth more than the last
| Status | What it means | Typical value per acre, English village edge |
|---|---|---|
| Agricultural | Grazing or arable, no planning prospect in the plan period | £8,000 to £15,000 |
| Hope value | Beside a settlement, not allocated, a credible case for an application | £20,000 to £80,000 |
| Allocated in the local plan | The council has said homes should go here | £150,000 to £400,000 |
| Outline permission | The principle of homes is granted; details to follow | £300,000 to £900,000 |
| Full permission | Number, layout and design approved; a builder can start | £400,000 to £1,500,000 |
The ranges are wide because the figure depends on house prices in that village, how many homes fit and what the council asks for in affordable housing and contributions. The point of the ladder is the gap between the first rung and the last. That gap is what an option or promotion agreement shares with you.
The developer's sum
Worked backwards from the finished homes
A worked example for a one acre village edge field that would take five homes, in a village where a new three bedroom house sells for about £450,000.
| Five homes sold | £2,250,000 |
| Less build cost, five homes at about £220,000 | £1,100,000 |
| Less fees, roads, services, contributions to the council | £250,000 |
| Less the builder's profit, about 20% of sales | £450,000 |
| What a builder can pay for the land with planning | £450,000 |
| Less the cost and risk of winning planning | £130,000 |
| The most we could offer before planning | £320,000 |
| Against the field's value today as grazing | £12,000 |
Every figure moves with the village, the number of homes and the council. What does not move is the method. We show you ours in writing before you decide anything.
Anyone can say your land "has potential". Value changes only when the council grants permission or allocates the land in its plan. Until then an offer that assumes planning is a hope dressed as a number. Ours assumes nothing: we check the plan, the history and the constraints first and we say what we found.
A landowner who can see the arithmetic can see whether the offer is fair. A landowner who cannot has to take it on trust. We would rather be checked.
Questions landowners ask
Straight answers
How much is my land worth to a developer?
What is hope value?
Does an allocation in the local plan mean I can sell for development value?
Why is your offer lower than the value with planning?
Free land review
Tell us about your land
Tell us the postcode. We do the rest at our cost and come back to you within ten days.