Buying property with land - All you need to know
- Some properties can come with agricultural ties or overage clauses
- Keeping animals on your property requires agricultural or equestrian permission
- Property with mixed residential and non-residential use can qualify for lower Stamp Duty rates
Whether it’s for greater privacy, space for your family, or to start a smallholding, there’s no shortage of reasons to look for a dream property with acres of land. And while buying property with land isn’t as straightforward as other property purchases, the results can be immensely rewarding.
In this guide we’ll take you through some of the quirks and potential pitfalls that come with the buying process to help you make the right decisions.
What you can do with your land
Two of the biggest reasons for buying properties with land are to keep animals or develop the site. And while both are definitely possible, there is a lot to consider before beginning a purchase.
When it comes to keeping livestock, you must register your property as agricultural land with the Rural Land Register. You'll also need a County Parish Holding (CPH) number from the Rural Payments Agency. Different animals have different legal requirements — sheep and goats need to be registered with DEFRA, while pigs, cattle and large poultry flocks must be registered with the Animal and Plant Health Agency.
Keeping horses on your land is a different matter again. Anything above grazing counts as equestrian use rather than agricultural, and you'll need change of use permission from your Local Planning Authority. For more details on keeping livestock and horses, read our guides to smallholdings and equestrian property.
As for building on your property, any new dwellings or permanent structures will require planning permission. This can be notoriously difficult for rural locations, particularly if you’re close to any protected wildlife habitats or an Area of Outstanding Natural Beauty (AONB).
It pays to speak to the relevant Local Planning Authority before you buy to see what developments might be permitted, and what has been rejected in the past. You can also check for AONBs, nature reserves and conservation areas with the Environmental Layers in Addland Pro.
Stamp Duty for property with land
If you’re buying property with land, you’ll almost certainly have to pay Stamp Duty Land Tax.
Stamp Duty currently applies to land transactions above £500,000, although this threshold is temporary for 2021. From July 1st the threshold will fall to properties above £250,000 and then return to £125,000 after October 1st.
You might be eligible for lower Stamp Duty rates if your land is classed as mixed-use. That means that in addition to your residential property, your land is also used for non-residential purposes such as agriculture, forestry, or commercial property like offices. Any application for mixed-use rates is subject to approval by HMRC.
Terms to consider
Properties with land can feel like a minefield, as you’ll often encounter terms that don’t come up in a usual property search.
- Unregistered properties. If the property you’re buying hasn’t been registered with HM Land Registry, that means the seller has to produce the physical title deeds to complete conveyancing. This can make the sale longer — especially if the deeds are lost and the seller has to provide other evidence of ownership.
- Agricultural Occupancy Conditions. An AOC, or agricultural tie, is a condition that requires the occupants of a property to be currently or previously employed in agriculture.
- Overage clause. Also known as an uplift or claw back provision, this is an agreement that if the buyer obtains planning permission to develop the land, the seller is entitled to a share in the uplift in value. When buying, pay attention to the length of the clause, the size of the seller’s share and what type of permission triggers the payment — these should all be open to negotiation.
Buying property with land is a unique experience with unique considerations. But navigating the process doesn't have to be daunting, and the reward of finding your dream property is more than worth it.
Addland makes it easy to find, research, buy and sell land. Start your land journey today.