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Last Updated: Thursday, 14 December 2006, 00:25 GMT
CPRE wants 'land banking' regulation
By Melanie Abbott
Radio 4's You and Yours

Devon countryside
CPRE thinks land regulation should be stronger

The Campaign to Protect Rural England (CPRE) is launching a campaign to get the practice of "landbanking" regulated by the government.

There are 29 companies offering plots of land for sale, many of them in or close to green belt land.

The principle is simple. You buy up a piece of agricultural land, divide it into smaller plots, upwards of eighty square metres.

You then sell those plots, often via the internet, to investors, who are told they will get a healthy return when the field is eventually bought up by a developer.

Legal action

"Hundreds of people are being told the value of this land will rise because one day houses will be built on it.
Shaun Spiers, CPRE chief executive

But most of these plots are in areas which local authorities say are unlikely to get planning permission.

Shaun Spiers, CPRE's chief executive says: "We believe the financial services authority needs to get involved in this issue. Hundreds of people are being told the value of this land will rise because one day houses will be built on it."

"But that one day might not be in any investor's lifetime."

An investigation by BBC Radio 4's You and Yours programme has uncovered buyers who say they were misled about how quickly the land would get planning permission or be earmarked for development.

Madeleine Sutcliffe, from Middleton in Teesdale in County Durham, bought three plots in three locations from a company called European Land Sales Partnership spending a total of 27,500.

"They said it was an opportunity not to be missed. I was told there was every likelihood that planning permission would be granted within the very near future and I could actually get about 3 times the amount of my investment."

That was two years ago and since then Madeleine has found information about when the sites will be developed hard to come by with her letters going unanswered.

She is one of a group of investors taking legal action against European Land sales partnership, which also trades as Commercial Land.


The company said: "Madeleine Sutcliffe has now been contacted and everything has been explained to her personally. The failure was that of the salesman, who being busy had overlooked his duty to call our clients who we value."

The firm has been banned from using its promotional video in Australia on the grounds that it is misleading.

The consumer affairs department in Victoria ruled that the film grossly misrepresents the likelihood of planning permission being granted.

European land sales partnership told the BBC it is in the process of reaching an agreement with the government of Victoria in Australia which should be settled in the next few days.

And the company added "Our organisation is a bona fide one which has a clear set of guidelines for our salespeople to follow. Breaches of these guidelines lead to our disciplinary procedure being enforced and in severe breaches dismissal results"

'Planning reform'

It is instances like Madeleine's which has prompted the CPRE to launch its campaign.

Shaun Spiers says "the Government needs to take it very seriously. At the moment it falls between a whole alphabet soup of the Advertising Standards Authority (ASA), Office of Fair Trading (OFT), Financial Services Authority (FSA)."

"We would like a reform of the planning legislation and want local councils to have more freedom to tackle the impact of landbanking on the countryside"

The government says it recognises the potential harm of sub-dividing land in this way but pointed out the purchase of a plot of agricultural land does not entitle the new owner to do anything with the land, other than to use it for agricultural purposes.

You and Yours reports on landbanking on Thursday 14 December from midday on Radio 4 or hear recent programmes online at the You and Yours website.

New countryside body reveals aims
10 Oct 06 |  Science/Nature

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