What are Option Agreements?
Option agreements are a process that allows us to unlock the full potential of your land or development site without costing you a penny. Normally we would come and assess the site, work out the most suitable type of development and the overall value of the site once it has been developed. We would then make you an offer to purchase the land on the condition planning permission is granted.
The Advantages of Option Agreements
- They don't cost you a penny, we cover all the Legal fees (both yours and ours), all the planning fees, environmental studies, flood requirements, local council requirements etc.
- Substantial increased valuation for the land, we value the land with its full potential realised, and not as empty or undeveloped land and as such can be worth up to three times as much.
- No long drawn out complicated planning applications for you to deal with. We do all the planning applications, sort all notices out and do all the leg work aimed at realising the full potential of your land.
How does an option agreement work?
An option agreement is exactly what is sounds like; you agree a fixed price or a percentage price (based on development value) for us to buy the land subject to us obtaining planning permission. We then draw up the planning permission and deal with everything else.
Once planning permission is granted we then exercise the option (i.e purchase the land from you) at the stated price, we then develop the land as per the planning permission.
How long does it take?
The initial agreement normally takes about 8 weeks to be drawn up, checked by solicitors (both yours and ours) and signed by both parties (remember we cover all your solicitors fees)
The optional agreement will then have a stated time frame (normally two years) but this is set individually for each project. You may ask why two years, and indeed most option agreements are completed well before this time frame and can be completed in a little over six months.
The reason of the two year time frame is to allow us to deal with any planning or regulation issues required to obtain the planning permission and any appeals required (once again we cover all this costs of the planning application and architects fees).
Fixed Price or Percentage?
We offer our customers either a fixed price or percentage price option agreements.
Fixed Price where the price is set in the agreement and when exercised we pay that sum for the property. This has the advantage of being set in stone and not related to the exact requirements of the planning permission, where perhaps we only obtain permission to build five houses instead of the desired six.
Percentage is where we agree a percentage of the final fully developed site with you. This has the advantage of being more lucrative for you should we obtain planning permission for more and/or better properties (of course the opposite is true if planning is granted for less properties). The valuation is also done at the time of exercising the option and therefore reflects any increases in house prices during the period.
We at PJ Developments have years of experience in option agreements and planning law which allows us to offer you the best possible price and obtain the best possible development for your site.
Our usual Time frame
First we will come and meet you on site to discus your exact requirements and determine the suitably of the site for development. We would then provide you with a price based on the proposed development. Once this is accepted by you we would proceed as follows.
1-8 Weeks - Drawing up and signing of the option agreement
8-10 Weeks - Pre planning and consultation
10-14 Weeks - Drawings and submission of planning applications
22 Weeks + - Once planning permission is granted we exercise the option and
purchase the land from you
Call us now on 0843 289 3430 to get the ball rolling