So what is an option agreement? In short an option agreement is a way for landowners to achieve the increase in land values that is achieved through development without risking the substantial cost of obtaining planning permission.
We are always looking to purchase Land and Property for development. So How do you use an Option agreement on a land deal? and what is the purpose of it?
When we find a piece of land that we feel is worthy of development we often use an option aggreement to purchase the site from the landowner. This is at an agreed price within a fixed time frame, once the terms within the option have been met. The process of agreeing a price can be tricky, but we usually make a generous offer at the beginning above the market value.
The Option Agreement benefits both landowners and developers. A landowner has the comfort of us promoting their site for development and we have some security with regards to future of the deal. The purchase price will reflect on the planning risks.
The terms of an option agreement tend to relate to planning conditions. The agreement allows time for a site to be promoted through the planning process. During this time we aim to obtain the relevant planning permission. Once we get the planning, we normally notify the landowner and then purchase the site.
Are you considering selling your land? This is how the process usually works.
- We go and view your land and potentially agree a deal.
- Solicitors are instructed.
- We pay for the searches.
- Within 7 days you could have the money sitting in your account.