Under an option agreement, one party gives the other the right to buy land or property at a fixed price. In return, the developer will usually agree to take on certain obligations, such as agreeing to make an application for planning permission, and in some cases will pay an option fee. As such, the seller will find a buyer for their land if certain conditions are met, while the buyer will only be obliged to commit to the purchase if the project is a viable one.
Overage agreements enable a seller to share in an uplift in the value of their land following a sale if this is attributable to a change in circumstances. This may occur if the buyer attains planning permission or if the property or land goes on to be used in another way than it was used for at the time of sale. As a result, the seller is offered additional protection should the land increase substantially in value while the buyer can secure the purchase for a lower initial price.
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Our Option and Overage Agreement Specialists are based in Sheffield and advise and represent clients throughout England and Wales. Contact us today on 0808 164 1028 to find out how we can help.