Buying Neighbouring Land

There are many reasons you may want to buy land close to your home. It could provide an extension to your garden, a field for a child’s pony, or alternative access. With the right permissions in place, it could give you additional parking or let you build an extension, or perhaps you believe it has development potential.

‘People’s reasons for buying neighbouring land are multifarious,’ explains Karen French, a Chartered Legal Executive and Partner in the Residential Property team, ‘Buying so close to home, you probably have a lot of personal knowledge about the area, but it is still important to get the right legal advice.’

Karen considers some of issues and how our solicitors can help you.

Finding out who owns the land

The first task is to establish who owns the land. If the land is part of your neighbour’s garden or farm, then you may already know the owner. Sometimes, even when you think you know the owner, things can be more complicated. They may, for example, own the land through a trust or company, and it is important to be clear about the structure of ownership before proceeding. Often a suitably worded enquiry of your neighbour will reveal any potential issue, which your solicitor can then investigate.

Sometimes ownership of land may not be clear. In that case, a search of the public index map at the Land Registry will reveal if it is registered. Most land is registered and so you can easily identify the legal owner from the register. However, a small percentage of land is unregistered, and finding its owner will involve more detailed investigations, for example, through consulting local authority and planning records, or looking at the titles of adjacent properties.

Occasionally, a piece of land may have no legal owner in the usual sense because it has passed to the Crown. This could be the case where the company that owned it has been dissolved. You, or your legal advisers, would then need to contact the Bona Vacantia division of the Government Legal Department or the relevant Crown office.

In all cases you must ensure the seller has a good title to the land, and your solicitor can usually do this by checking their deeds or the Land Registry’s records. This is usually relatively straightforward. However, sometimes establishing legal ownership can be more complex. For example, someone who has occupied land for a long time may not have any title deeds. Instead, their ownership depends on a legal doctrine called ‘adverse possession’. This could apply where a neighbour has, over the years, informally incorporated other land into their garden. In other cases the legal ownership may be clear but, because the land is held in trust or by a company, there may be additional issues to consider. In such cases, it is usually still possible to proceed with the purchase. However, there will be additional factors to consider and your solicitor should explain the implications and how to minimise any risk.

Agreeing a price for the land

It is down to you and the landowner to agree a price, and one of you may already have a figure in mind. However, it can be hard to know if this is a realistic reflection of the land’s value.

In contrast to buying a house, you are unlikely to be able to see its past sale price or to compare it to other plots in your road via the online property portals. Instructing a professional valuer can remove some of the uncertainty over its value and prevent you from paying more than it is objectively worth. Other factors that could affect the price may include the number of people who would like to buy that land, and whether you are the only person with access. If the land is an infill plot between your property and another, the seller could argue for a higher price because of its potential interest to your other neighbour should it come on the market.

Its value may also be affected by any adverse matters in the seller’s title. Your valuer, if you are using one, should liaise with your solicitor, or at least be aware of any title issues. If there is a restriction, for example against building or which says you can only use the land as a garden, the price should reflect this. When you agree the purchase with your neighbour, you could specify that the price is subject to ‘no adverse matters’ as well as saying it is ‘subject to contract’. This may make it easier to renegotiate the price if you later discover something unexpected, such as a title restriction affecting the land’s value.

The need for planning permission

Whether you need planning permission will depend on your plans for the land. If you are not changing its use or building on it, you are unlikely to need permission. However, you should always check the position before buying. For example, special rules apply if your property is in a conservation area and you may need consent for things that do not usually require permission, such as erecting fencing.

Where you plan to change the use of the land, for example, by incorporating part of a field into your garden, then you may need planning permission. You will also usually need permission to build on the land or to develop it. Discuss your plans with your solicitor before committing yourself. They can advise you on the requisite consents and may suggest making your purchase conditional on obtaining them. That way you would not have to complete your purchase if you do not get the permission necessary for your plans.

Alternatively, if the seller knows that the land has development potential, they may seek to include an overage clause which means you would have to pay a part of the increase in value if you obtain planning permission in the future.

Consider any rights or title restrictions affecting the land

Your solicitor will examine any rights or restrictions in the seller’s title. For example, your neighbour’s land could be subject to an existing right of way or an agreement that somebody can park their car on it, or there could be a restrictive covenant against building that could affect your plans for a home extension. By investigating the seller’s title, your solicitor can advise you of any such matters, their likely impact, and set out your options. For example, you may be able to obtain a release of the restriction against building or cover the risk of someone trying to enforce it through insurance.

In addition, your seller may want to reserve certain rights over the land themselves, for example, for access or to run services, or they may want to restrict how you use it, for example, to prevent you from building on it. Conversely, you may want rights over your neighbour’s retained land, for example, to connect into utilities. It is easy to overlook these types of issue when agreeing terms. However, they could impact significantly on your future use and enjoyment of the land, particularly if you plan to develop it. Your solicitor can advise on these and ensure the documentation accurately reflects your agreement with your neighbour.

Boundaries and the transfer plan  

Establishing the precise boundaries of an existing parcel of land can be difficult as Land Registry plans do not usually give this level of detail. So, if there are any boundary issues that concern you, or features such as a hedge that you think should be included with your purchase, tell your solicitor. They can then examine the seller’s title deeds and confirm the position.

You will need a plan delineating the land you are buying, and to attach to the transfer. It should set out clear boundaries. A surveyor can map these and show their relation to physical features, such as a wall or corner of a building. This will provide clarity and help avoid disputes in the future. In some cases, a boundary agreement or an application to the Land Registry for a determined boundary can be a good idea, for example, where there is background of encroachments or work is planned near the boundary.

One issue to be aware of is the possibility of a ransom strip, particularly if you plan on developing the land. A ransom strip is a small slither of land that typically lies between land that is to be used for development and the highway, although it could equally prevent access between your land and the ‘adjoining’ plot. In the latter case, provided both your land and your seller’s have been registered, it should be relatively straightforward for your solicitor to check that the two titles abut and that there is no ransom strip. Issues of access to the public highway can usually be resolved by looking at the title deeds and local authority records. However, it is important to discuss your plans, particularly any development proposals, with your solicitor. They can then check for any potential issues.

Protect yourself legally

To become the legal owner of the land, you must observe the correct formalities.  

If your seller has a mortgage, their lender will need to release the land from their charge before it is transferred to you, and both the release and transfer will need to be registered at the Land Registry. Otherwise, third parties could acquire rights over your land, sometimes without your knowledge, and you are likely to have problems when you come to sell or remortgage.

Your solicitor should ensure the transfer is registered, and that your rights are protected. A future buyer is likely to consider the additional land as integral to their purchase and will expect to see all the correct documentation in place.

How we can help

Whether buying a strip of garden land or a more substantial development plot, it is essential to get the right legal advice. Our expert property lawyers at Sills & Betteridge will provide advice tailored to your purchase and ensure it is protected legally.

For further information, please contact Karen French in the Residential Property team on 01205 364615 or email KFrench@sillslegal.co.uk