Big Surge in Low Risk UK Land Investment

03 Nov 2019 - by highgrove

Big Surge in Low Risk UK Land Investment

Is it any surprise that housing shortages have opened an interesting window of opportunity?


Statistics establish that PRS (Public Rented Sector) accounts for 16.5 percent of all households. In addition, bank deposits are at an all-time low, making money by holding the deposit near impossible. Not only is this, but an even more disturbing trend is the low exchange rate of pound sterling against other currencies, making international investments less appealing.


The changes in the Housing Bill in 2017 make it even easier to take brownfield sites and provide group or individual investments. These investments can take on several different formulas, depending on the investors and land development needs. Planning applications are easier to process than ever before.


Now the question is “how to take advantage of planning”?

The current conditions have developed into a local opportunity the likes of which have never been seen before. There is growing interest among institutional investors, making the residential market, which is usually made up of individual investors with smaller portfolios substantially more viable.


Properties outside of London are now attractive to pension fund families and foreign wealth funds, as they have a better chance to provide brownfield site planning and development opportunities. Local councils have been set targets that require new housing development planning. This creates a current environment of planning application acceptance.


The current trends allow a wider range of profitable planning whereby making local councils happier to accommodate well-funded planning and development that meet their set target goals. Due diligence and inspections are conducted by specialists to ensure that planning applications meet council set target goals.


Properties that meet rigorous scrutiny are then purchased by a special purpose vehicle and a UK limited company is set up. This UK limited company will hold and own the property while planning application and development proceeds. Shares in this company are then allocated to each investor based on agreed terms. Specialists conduct and provide for the planning application process, in line with current target goals.


Once planning has been granted, the property is marketed for sale, often developers purchase is agreed upon beforehand (subject to planning approval and permit acquisition). Once a buyer is found land assists are transferred and investors are paid the profits. This type of investment formula is low risk to the individual, as well as the institutional investor.


Population growth and rising property values create a win-win scenario. The formation of the UK Limited Company provides the personal protection many investors have been asking for. The end profits are then manageable within personal financial planning. 

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