Why Is Greenbelt Land Being Reclassified?

Why Is Greenbelt Land Being Reclassified?

Housing, housing, housing. The UK government is facing a huge task at the moment that is trying to build a huge number of houses because of overpopulation. One major consequence of this is seeing the value of land rising significantly, with potential investors keeping a close eye on proceedings.

Let's take a look at the issue of overpopulation and the housing shortage first. The UK is facing a situation where their population will rise by 7 million by 2021, based on birth rate, mortality rate and immigration rate that is to say they have an ageing population and liberal policies regarding immigration.

The effect this is causing is the need for many more homes, 1.4 million affordable homes to be exact. Now the UK is a pretty small place, and it's increasingly difficult to find places to build affordable homes. Therefore, the government is turning to the previously untouchable Greenbelt sites to solve the problem.

What are Greenbelt sites? Well along with Brownfield and Greenfield sites, it is a classification of land type used by local authorities. Land types are given a classification so that local authorities know which ones to develop on. For example Brownfield sites are land that has been previously developed on, but are now derelict. Greenfield sites are previously undeveloped sites that are considered for development. Greenbelt sites were created after WWII, its main objective was to prevent towns and cities from developing and merging onto each other for fear development will destroy the countryside in the UK.

Well, unfortunately Greenbelt sites are being reclassified into Greenfield sites so they can be developed upon. Fear not though, as councils have to reclassify the same amount of land that is lost to development back into Greenbelt sites. Nevertheless a certain amount of swapping and reclassification is happening. To give you an idea, a Greenbelt site in Stevenage, Hertfordshire has been reclassified to build a total of 10,000 new homes.

There has been a very profitable side effect of this rezoning, a side effect that has seen investors become very wealthy. This is making land a very lucrative commodity, especially land that is classified as not designated for development, but is earmarked for rezoning, such as some Greenbelt sites.

For example, land that is undeveloped and is classified as undevelopable is a lot cheaper than land that is classified for development if you have land with residential development, its going have a higher value than land with nothing on it.

So how are investors getting wealthy? They invest in land that has the potential to be reclassified. Known as strategic land investment, they buy UK land for sale and watch their stock rise and rise. This trend has continued for the last 20 years, with a 30% increase in land value in the past year and a potential increase of 16% in land value by 2012, making this investment type incredibly consistent and rewarding.

Take advantage of the housing crisis and the rezoning of land types; invest in undeveloped land for maximum returns.

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