It is becoming more and more common that small parcels of land such as back gardens are being sold for development. Such parcels are attractive to developers looking to utilise spare vacant land, which typically benefits from sitting within a residential setting. These transactions also benefit the landowner who can profit from selling excess land they no longer need.

However, caution should be taken (by both parties) to carry out full due diligence, to include a review of the title (whether registered or unregistered) and the usual conveyancing searches. Without carrying out such due diligence, the garden land could for example be subject to a restrictive covenant prohibiting any structure to be built on the land. Landowners also need to ensure that post completion of the land sale, their use of any retained land (usually their main residence) is not hindered in any way.

Selling

When selling part of your land you will want to ensure that you can continue to enjoy your retained land, uninterrupted. You may also have preferences as to how the sold land is used and will want to ensure that such preferences form part of the agreement with the developer.

For example:-

  • You may wish to ensure that the developer does not build a five storey structure which would overlook your property and block your south facing garden from the sun.
  • You may also want to ensure that access to this new development does not result in a constant stream of traffic running down the side of your property.
  • You may want to specify who is to be responsible for maintaining and repairing the partitioning fence.
  • You may want to reserve the right to connect to any upgraded services as a result of the development.

Placing covenants on the Title Register for the new plot can help you control such factors.

Covenants can be utilised to limit the type of structure capable of being built on the plot, restrict access rights and prohibit certain uses of the land, amongst other uses. Restrictive covenants, which prohibit an action, “run with the land” meaning that even if the developer later sells the plot, the new buyer will also be bound by the terms of the covenant. This allows you to maintain control even over an extended period of time, and even after the land has changed hands several times.

However, it is important to note that even if such restrictions are put in place, the developer or indeed any future owner of the land may apply to modify or entirely discharge any restrictive covenant.

If you have a mortgage, it is also important to check that your lender approves any proposed sale. They are likely to request a valuation of the land to ensure that their security is not adversely affected by the loss of the parcel being sold.

Buying

If you are buying part of someone’s land, you will want to ensure that you have sufficient rights to develop the land how you wish. You should also keep in mind any plans you have for the future development of the land, and how restrictions may be viewed by a prospective buyer.

Any covenants limiting the type of structure you can build must be considered in conjunction with your development plans. It is also important to ensure that you have sufficient access rights and the necessary rights to connect to services such as electricity and water.

If you have purchased land with onerous covenants which are impeding your use, it may be possible to negotiate the removal or variation of those covenants. Also, you may be able to formally apply to HM Land Registry to have such covenants modified or discharged. In order to be successful in such an application, you must be able to prove one of the following grounds:-

  1. The covenant is now obsolete;
  2. You have agreed with the beneficiary of the covenant (e.g. the owner of the retained land) that it can be modified or discharged;
  3. That modification to the covenant or its discharge would not injure the beneficiary; and/or
  4. The covenant impedes a reasonable user of land and does not secure any practical benefits of substantial value or advantage.

Regardless of whether you are a landowner or a developer, avoiding the issues stated above is best achieved by obtaining legal, planning and architectural advice at an early stage. Doing so will help you to negotiate the best possible terms, in addition to ensuring that you are fully informed of the risks of entering into any agreement.

If you have any questions about buying or selling a back garden plot, or have a query following a sale or purchase, please do not hesitate to contact one of our property experts who would be happy to assist.