HPH224 : What due diligence should you carry out before buying land? – with Rob Wiggans
Aug 29, 2018
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Rob Wiggans, land development expert, shares insights on minimizing risks when buying land. Topics discussed include importance of due diligence, determining land value, impact of recession and Brexit, methods of finding land, and the critical research buyers must conduct before proceeding with a site.
Engaging in due diligence when buying land involves conducting ground investigation, ecology surveys, and archaeological assessments to minimize risks and ensure alignment with objectives.
Consulting local authorities, service providers, and professionals like architects and solicitors is crucial for successful land purchasing and project planning.
Deep dives
Importance of Due Diligence
Due diligence is a crucial part of buying land, ensuring that the purchase is secure and aligns with the buyer's objectives. Engaging in due diligence involves several key aspects, such as ground investigation, ecology surveys, and archaeological assessments. Ground investigation helps understand the soil conditions and potential contaminants on the site. Ecology surveys determine the impact on wildlife and natural habitats, while archaeological assessments evaluate any historical artifacts or sites. It is essential to consult professionals like solicitors, architects, and consultants to conduct due diligence thoroughly and manage potential risks.
Engaging with Local Authorities and Services
When purchasing land, engaging with local authorities and service providers is crucial for a successful project. Pre-application meetings with local authorities help understand planning requirements and obtain valuable insights. Consulting traffic consultants ensures adequate access for vehicles and emergency services. Engaging with service providers like United Utilities helps gather information on water and drainage connections. Additionally, addressing legal issues such as rights of way and covenants is crucial for ensuring lawful access to the site, and relevant insurance can cover any unexpected legal complications.
Understanding Land Value and Development Costs
Properly assessing land value and development costs is vital for a successful project. The land equation involves determining the gross development value (GDV) by considering the cost of all properties on the site. Subtracting development costs like build costs, fees, and infrastructure expenses from the GDV provides an estimation of the land value. Factors like demand, labor, and material costs can significantly impact the overall development costs. Extensive research and consulting local agents help assess the ceiling value and understand current market trends.
Building a Strong Team and Trusting Gut Feelings
Building a strong team of professionals is essential for navigating the self-build process successfully. Engaging with recommended architects, planners, lawyers, and consultants helps ensure comprehensive due diligence and informed decision-making. Trusting one's gut feelings and exercising patience during the search for suitable land is crucial. It is advised to conduct a dry run and evaluate sites that may not meet all criteria to gain experience and develop a sharper eye for key considerations. If doubts persist or confidence is lacking, it is wise to exercise caution and explore other options.