Whether it is a small patch of their garden, an access path or a significant acreage, how do you go about buying land from your neighbour?
Whilst buying land essentially involves the same process you would follow for a property transaction, depending on why you want to buy the land (i.e. your intended use), where it is located and who actually owns it, there can be some additional complications.
What do you need to do before you make an offer on a piece of land?
Most importantly, you need to ensure that your neighbour actually owns the land before you offer to buy it from them. If they own the property on a leasehold basis for instance, the actual owner would be the freeholder.
If you were to purchase either the leasehold or freehold (with your neighbour retaining their leasehold rights to the land), ownership and access rights can then become more complicated.
For shared ownership properties, unless your neighbour has increased their share to 100% ownership and purchased the freehold then, again, they would not own the land that their property is built on.
You may even find that your neighbour does not actually have a right to the land at all if it has been unofficially subsumed into their garden by them or a previous owner.
‘Adverse possession’ dictates that if the land has been treated as their own for more than 10 years that they may be classed as the legal owner, but this is a complex issue and you need to ensure that you are buying land from the person who has the authority to sell it to you.
You can find out if the land you are interested in buying is registered and who the registered owner is via the HM Land Registry website for a small fee. Where land is not registered, your neighbour will need to provide you with sufficient evidence to confirm their ownership before any money changes hands.
Whether your neighbour has suggested the sale or you have decided to enquire about buying the land, before you make an offer you should have the land valued to ensure that your offer is fair to both parties. This can be done by an estate agent or chartered surveyor.
In most cases, a valuer should be able to discretely appraise the land from your own property and seek any additional information online, but if not, do ensure that you have asked permission before traipsing a stranger across your neighbour’s property!
When it comes to an enclosed space such as a garden, it can be tricky to put an exact monetary value on the land when the value lies in its individual importance to you in terms of quality of life.
For example, by allowing you to extend your home, house pets or livestock or provide the opportunity to run a business. A valuation of the land will therefore give you a useful figure to base your negotiations on, in consideration of the following factors:
- Its location.
- Its condition.
- The size of any existing garden.
- The value of the house next to it.
- Whether car parking would be possible on that land.
- The relative scarcity of land for sale in the area.
- Other local competition factors.
However, be prepared to haggle because your neighbour will obviously want the best offer possible in the knowledge that the land is important for you, even if it is of little value to them. Equally, you do not want to pay more than you need to, particularly since there will be other costs involved in buying the land.
Depending on your plans for the land, you may also need to do some additional research before making an offer.
For instance, if you hope to buy the land with the intention of extending your own property, it would be useful to see if planning permission has been sought previously and if this was granted or whether there are any special covenants in place which restrict how the land is used. Contact your local planning authority for more advice.
If near neighbours have had similar extensions, taking a look at their planning applications will show whether there has been any opposition to the build and how plans may have been adapted for successful approval.
Buying the land
As we have mentioned above, the process of buying land is, in essence, the same as buying a house. You will need the assistance of a good conveyancing solicitor or conveyancer to undertake the legal aspects of the land transfer in the same way they would act for you when you buy a property.
You would also generally be expected to cover the costs of your neighbour’s legal fees, so bear this in mind when it comes to budgeting. As long as both parties agree with the principles of the sale, the same conveyancer can usually act for vendor and buyer, which can be more cost effective.
Once you have agreed the price you will pay for the land, your conveyancer needs to arrange for a plan to be drawn up showing the land being sold so that the Land Registry can formally update their records for both your land title and your neighbour’s.
As part of this process they will also undertake the necessary local searches and arrange for the official transfer of monies and land. This includes the Transfer of Part documentation, and this will include any stipulations your neighbour has in relation to the sale, such as how the land will be used in future.
If your neighbour has an outstanding mortgage on their land and property, they will also need to ensure that their mortgage lender is happy to amend their mortgage agreement to remove the charge for the land which you are buying and has updated their policy accordingly. If you proceed without this agreement from your neighbour’s mortgage lender, you may have to forfeit the land if your neighbour falls behind on their repayments.
Your neighbour’s mortgage lender may also request that your neighbour makes a partial repayment of the original amount borrowed, particularly if they are selling a significant amount of land which will have an impact on the value of their property.
Of course, it is important to remember that if you are making the offer to buy your neighbour’s land out of the blue, they may say no! In which case, ask if they could keep you in mind for first refusal if they do ever decide to sell the land, or indeed the entire property, in future.
Whilst it is a more long-winded and costly way to do things, you could always buy the property and then resell minus the land you wish to acquire.
Issues relating to land and property boundaries can normally be agreed informally with your neighbour and will not require a land purchase. For more information on boundary agreements, head to https://www.gov.uk/your-property-boundaries/boundary-agreement-neighbour.
Disclosure: this is a collaborative post