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Last Updated: Thursday, 22 March 2007, 17:24 GMT
Selling England by the pound
Trudi Davies
The Politics Show South East

Sale Agreed sign
Will this become a common sight in rural acres?
There's a term out there that can make some people a very fast buck... "land-banking". Plots around our green and pleasant land are being speculatively snapped up and sold when the time is right... but is it right?

Pilgrim's Vale, Chitcombe Park, Bluebell Grove.

As locations go, these sound attractive don't they?

They conjure up images of rural idylls, sylvan glades and stress free living and leisure time.

They are all in the South East region but you'd be hard pushed to find any of them on a map.

Names like these feature heavily in websites created by companies involved in schemes that come under the title of "land-banking".

Never heard of it?

It's a practice whereby companies purchase land on the edges of towns, villages and urban conurbations and when the time is right, they "make a killing".

The land may be agricultural, green belt or green field but the companies divide it into individual plots and then sell these on to individuals as investments for the future.

Some make much of the government's drive to create more affordable housing.

Demanding supply...

Tractor
Who could imagine the South Downs with tarmac and decking?

Others refer to the Barker Review on planning decisions and the green belt, but the upshot for most, is the belief that with so many houses demanded by the Department for Communities and Local Government, they will have to go somewhere.

When the land is rezoned, so they say, the potential profits for investors will be large.

If you take a look at the figures it's not hard to understand why consumers might be tempted to gamble on rezoning.

According to the Barker Review, the average price of a hectare of agricultural land in the South East is around 6,000.

The same size of land allocated for housing is nearer the 2.5m mark.

That's an increase of over 250%.

Leaving aside the argument that if there is so much potential profit in a piece of land it seems odd that a company should wish to sell it off piecemeal, does it really matter that individuals are buying into the greenbelt in the hope of a large profit or a future pension?

It depends on your point of view.

Foreign buyers

Many of these companies target buyers in other countries, India, Australia and the Middle East are favourites.

Politics Show research has brought to light the fact that one small field near Maidstone is currently owned by people in no less than four continents and in other countries, at least, it's starting to ring alarm bells.

In Australia, the State Government of Victoria has an active programme to warn people against the practice.

Similar warnings abound in the Indian press, but in the UK there is no official government warning to alert potential investors to the issues associated with land bank investment.

At a local level this can cause problems.

Tonbridge and Malling Council were contacted by residents living around the field near Eccles.

They became concerned when men were seen marking out the field with wooden posts into individual plots.

Cllr Dave Davies discovered that the land was being marketed on a website as prime development land with a full diagram showing house plots, roads and access points.

Although the site looked as though it was ready for development, potential investors would have been wise to contact the council themselves.

Cllr Davies points to the Council's Local Development Framework.

Here, land is earmarked in 10 year blocks.

Misty morning in Sussex
Do you know of patches of green and pleasant land for sale..?

The field near Eccles has "no potential for development before 2025", claims Cllr Davies.

In fact he goes further, saying: "I'd be surprised to see housing on here within 50 years."

Councils cash in..?

However short of putting up warning notices at the actual field, there are few options open to councils.

They could ask the Secretary of State to authorise an "Article 4 Directive" - a legal notice that prohibits the erection of any structure without planning permission and they can turn down any subsequent planning applications.

In the meantime though, they are left to deal with any problems at a local level.

Land bought and sold in this way can quickly become unmanaged and take on a derelict air.

The local people worry about what will happen to it and the council have to meet the costs of any fly tipping or its use as an illegal travellers' site.

But the land investment companies could be seen to be cashing in at a time when housing in the South East is in crisis.

The South East Development Agency (Seeda), recently said that in their canvassing of businesses in their area, the single biggest inhibitor to business growth is the lack of places in which to house the workforce.

In the South East, we simply don't have enough houses.

We investigate...

At the Politics Show we have conducted our own research which, whilst not exhaustive, is quite illuminating.

A systematic search of the internet reveals at least 38 land investment sites for sale across the region.

Calls to all the councils reveal that they are only currently aware of 20.

Building works
There is an insatiable demand for new housing

So, on the one hand we have private companies selling off land that has the potential to house the workforce that the region needs for growth.

But on the other, we have councils placed in a position of dealing with the consequences whilst being struggling to find the space to fulfil the government's demand for more housing.

On a recent Radio 4 programme, Yvette Cooper, Minister for Housing and Planning, said:

The challenge we do seriously face is about having enough homes for the next generation. If we don't build more homes now we will see the consequences in 10, 20, even 30 years time. We will see this as problems for people that can't buy their own home or can't get on the housing ladder. I think that's not fair. It's not fair on the next generation if we don't build these extra homes.

So more fuel for the promotional websites of many of the land investment firms.

Barker Review

The Barker review, commissioned by Tony Blair and Gordon Brown to look into planning issues, was released in December 2006.

Many of Kate Barkers recommendations chime well with Yvette Cooper's comments.

At a local authority level she recommends that:

the allocation of land for housing should become more responsive to demand for housing. In drawing up local plans, planning authorities should allocate buffers of additional land, which would be released for development as triggered by indicators of unexpectedly high demand.

Just what the land investment companies are doing - but for private, rather than public gain.

Barker also puts forward the suggestion that councils themselves could effectively bank land.

If they were to buy the agricultural land at the going rate, or even double the going rate, they could award themselves planning permission on it, as and when the need arose.

By selling the land to developers as designated building land, the profits would be large and would come back into the council's coffers.

Urban tinted glasses

Derelict house
When old properties are run down - will new ones spring up in their place?

The public's view of development is distorted.

Twenty years ago, two thirds of the population thought that 65% or more of the UK was urban - even in 2006, the real figure is only 8%.

Could land investment companies also be exploiting a misunderstanding that has people demanding green belt protection at the first sign of more development?

Neil Sinden, policy director of the Council for the Protection of Rural England thinks that Barker may be playing fast and loose with green belt definitions.

Just because the public don't understand their function he argues, is no reason to abandon them:

Green belts are the crown jewels of the British planning system, we meddle with them at our peril. The report fails to recognise the positive role green belts have played in promoting regeneration, preventing sprawl and securing easy access to the countryside for millions of people.

Still green and pleasant

But the fact remains that if nearly 90% of the country is still green and we need to create more housing stock then perhaps it makes sense to add to existing conurbations and to allocate more of our redundant agricultural land to housing as Barker recommends.

As long as the government fails to provide councils with the means to exploit the land then private companies will continue to fill the void.

With the massive discrepancies between the values of land, maybe we should thank companies that are looking to share their potential profit with individual investors?

However, it is one thing to offer land for sale and another to promise the earth no matter which government department you quote in the sales literature.

With this in mind, and to discover whether it is a case of caveat emptor, Paul poses as a potential land investor this week to find out just what the land investment companies say about the planning process, housing targets and potential profit.

As companies target the South East, we ask what the cost is for the region's councils and what help they need from government to combat the growing trend.

And, we meet a buyer who owns 0.3 of an acre in Uckfield who is travelling down from Yorkshire to see his plot for the first time.

In our region over the next 20 years, the South East Plan means the building of nearly 200,000 new homes, this equates to an average of almost 10,000 new homes a year, but will any of them go on his plot?

In the studio Cllr Matthew Balfour, Neil Sinden from the Council for the Protection of Rural England, Brian Smith from UKLI and Rachel Emmett a buyer of land discuss the issues. Please feel free to have your say.

Please feel free to have your say.

Green belt or housing which is the most important in 2007? Does it really matter who owns the land at the back of your house? Join our debate this Sunday. We would like to include as many of your views as possible so:

Text us on 07786 209252 or email us at politicsshowsoutheast@bbc.co.uk or via the link below.

The earlier we receive your comments the more likely we are to get them on air. You don't have to wait until the show has started!

If you have experiences or comments to make on land investment, planning processes and the role that councils play then please use the e-mail form below and key in LAND BANKING in the comments section...

Road to ruin?

Traffic jams
There seems to be a jam around every corner these days

When we return after Easter we are going to be taking a look at the South East's transport problems.

Jeff Brown from North Kent Chamber of Commerce claims that the region is grinding to a halt because no single body has control over the policy.

Kent grinds to a halt every time Operation Stack comes into force, travel across the region from Sussex to Kent is hampered by he lack of road infrastructure and public transport is piecemeal.

He is concerned at the cost to businesses and growth in the region and will be reporting for us on 15 April.

BUT WHAT IS YOUR EXPERIENCE OF MOVING AROUND THE SOUTH EAST REGION?

We want you to add to our report this week so if you have the ability to take moving pictures on your mobile phone then please send them in.

All you need to do is send them to 07921 648 357. Comments and still pictures would be welcome too just text or email to the usual address.

And once again this week don't forget to VOTE on our topical issue. The South East vote

Our first show after Easter will be a special report on transport in the South East. So this week we are asking: Is road pricing the only way to keep the South East moving?


Last week we asked - Do you think that the South East's greenbelt is under threat?

The results are in!

83.33% of you voted Yes

16.67% voted No


VOTE RESULTS
Is road pricing the only way to keep the South East moving?
Yes
 21.43% 
No
 78.57% 
14 Votes Cast
Results are indicative and may not reflect public opinion


Don't forget to VOTE...

Just a click of the mouse will register your vote on our new, unscientific, but interesting, test of the region's opinions vote now...

We will let you know the result after Easter.


Text us on 07786 209252 or email us at politicsshowsoutheast@bbc.co.uk or via the link below to add your voice to the debate.

It is easy... to take part in the show... If you have an idea for an item, want to make your own report or simply want to comment on what we are doing then please get in touch by e-mailing through the form below or write to the Politics Show team at:

Politics Show, Lambent Productions, The Media Centre, 21-22 Old Steyne, Brighton, BN1 1EL

The Politics Show South East

Join the Politics Show team on Sunday 25 March 2007 at 12:00 BST on BBC One.

The Politics Show will be off the air after this week but will return on Sunday 15 April 2007... A happy Easter to you all...


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