Gains from small land can give more than a financial boost

At this current time, many local authorities find themselves with squeezed budgets. And as any good organisation should, they are assessing the value of their assets and finding that small strips of land and derelict buildings are costing more to keep than sell. But whilst de-risking and a cash injection is welcome, a sale to a local buyer can deliver so much more.

In many parts of the UK, local authorities are putting small strips of land, public toilets that are no longer in use and other land such as scout huts up for sale.

Raising cash might be the initial reason, but through analysis many local authorities find that these assets are costing more to keep than they are worth. At the root of this is the liability associated with land if it starts to become misused, but also the costs of maintenance.

With this multitude of factors it is easy to see why selling these assets is a good decision. However, there is often concern of a negative reaction from the public, but a local sale can be crucial to helping turn that around.

Small footprint, big impact

At auction, we are increasingly seeing that significant bidders for small strips of land often come from within the community.

This is because whilst these small strips of land are often too small to be built on they mean a lot to the communities they are located in. As a result, there is a positive impact to be had by enabling local ownership.

When sold to an individual, land tends to be used to increase garden size, extend houses or build allotments. And when concerning slightly larger pieces of land or those positioned centrally within a community we see groups – sometimes formed with the sole purpose of acquiring this land – taking ownership.

The actions that follow see the land used as a central place for community events, playing fields, allotments, or even simply to be maintained as a green space and prevent further development. This usage can even result in small scale rewilding or garden projects.

This positive community impact is something that local authorities will want to encourage.

Successful targeting

Unsurprisingly targeted communication and giving plenty of advance notice of the sale to locals is essential. This allows time to consult financial situations, organise group funds and fully consider a purchase.

Notifying local people that land is up for sale can be quite traditional, because notably we’re trying to get the attention of people in the immediate area that may even live opposite. This means ‘for sale’ boards with contact details on are highly effective. Localised door drops and the use of local news also work.

Additionally, selling via public auction ensures a transparent and fair sale, reducing the chance any local unease with the eventual use of the site, whilst also ensuring that best price is achieved for the local authority, within a set timescale.

Larger land, broader benefit

There are also property development opportunities but these too should impact positively.

For instance, old scout huts, former workshops and lock-ups that have not been used for a significant period of time attract a high number of bidders willing to pay, with local authorities surprised at the price that can be generated.

On average over the past 12 months, sales by local authorities across our auctions have achieved prices around 25% above the guide price. The reason being that planning permission and buyer demand are highly likely on many of these lots.

At this time when local authorities have to consider new avenues to maximise what they have, selling land is one route. But whilst weighing up if the land is costing more to keep than to sell is one factor, considering if it can be used for greater purpose by the local community should be another. If this can be done then selling land could deliver something significantly more positive than an injection of cash.