Does planning permission on a property for sale add to its value?

Property Clinic: My late parents’ home is on a large site with room for up to extra houses

If we got permission for a second house in the garden, would it raise the value of the overall property? Photograph: iStock

If we got permission for a second house in the garden, would it raise the value of the overall property? Photograph: iStock

 

My two siblings and I will be selling our late parents’ family home which is part of their estate. It is a dated 1950s house which would require a lot of upgrading, but which is on a large corner site in a south Dublin suburb. There is space in the garden for one, if not two, extra houses.

My query is whether it is a good idea to apply for planning permission for another house before putting the house on the market. If we got permission for a second house in the garden, would it raise the value of the overall property? If we got turned down, would it devalue the original property?

Could an architect help us by applying for permission based on fairly basic drawings, and roughly what kind of cost would we be looking at?

It would indeed be important to explore the possibilities of the potential site before placing the property on the market. You could instruct a local architect or building surveyor to investigate with your local planning office (South Dublin County Council) on your behalf to assess if there is any likely development potential.

If the result of these preliminary investigations is positive on a scale of 1-10, assuming that the proposed new house would be detached from the original house and retaining a side entrance, you could go ahead and obtain outline planning permission, thus increasing the value of the property substantially.

Modification

In the event of planning permission becoming likely for two units even if they are likely to be smaller, this would still of course further increase the value proportionately. If on the other hand the proposed new house is to be attached to the original, it would be difficult to sell the site separately as the original house would likely require modification and may prove too costly and more difficult for the builder to operate in conjunction with the owners of the original house, who may or may not wish to engage in such discussions.

Having obtained outline planning for a separate unit, you would need to engage the services of a solicitor and architect to legally separate the site and create a new independent title so the site can be sold separately. There will be a market for the site and a different market for the house. A builder buying the site would probably not want the house and the buyer of the house would not necessarily want or be able to afford to buy the house and site as one lot.

The value of the site would obviously be worth considerably more than any diminution in value of the house by losing the existing larger garden.

In summary:

1. Obtain opinion or outline planning for a separate dwelling (or two if possible).

2. Sell the site.

3. Sell the house.

You will end up with considerably more for the property rather than just selling the house with a larger garden. This would be well worth the wait and relatively low cost by comparison to the end result you could achieve.

If, at the outset, planning is going to be unlikely, at least you know that you are not underselling the property if you eventually sell the entire as one lot. – Roger Berkeley

Roger Berkeley is a chartered residential surveyor and member of the Society of Chartered Surveyors Ireland, scsi.ie

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