Property Option, Overage & Conditional Sale Templates
Read what Net Lawman says about property options:
"The law says simply that an agreement to buy real property must be: in writing; signed by both parties; dated; and must identify the land being bought. It is this last point that catches people out when they create property option agreements. Too often boundaries, rights of retention and other matters are not defined in sufficient detail. We offer several variants on a option agreement that provide solid frameworks around which you can negotiate your deal. Using an option agreement to buy land or property for development allows a buyer to minimise risk that a critical event for the success of the project might not occur, whilst at the same time providing the seller with a payment regardless of whether the buyer exercises his or her option."
Conditional Contract: property sale
Read what Net Lawman says about this template:
"This is a conditional contract for the purchase of real property. The template is suitable for any type of land or property. The deal is under contract and both sides are bound subject only to one or more conditions being met, most usually planning permission be granted. This type of agreement transfers the risk from the buyer to the seller that the buyer's intended plans for the land or property will not be prevented from happening. A conditional contract is an alternative to using property option agreements. An option places the option holder (usually the buyer) in control of the situation and the deal. A conditional contract provides a more certain situation in that the land owner knows he has sold subject only to the condition being met."
Option to Buy Land and Property: extension of term subject to conditions
Read what Net Lawman says about this template:
"This agreement provides for extending the exercise term subject to any condition you require, such as a delay in a local government decision to upgrade a road, for an additional consideration. It is suitable for deals in any type of land or property. It is a comprehensive version that covers conveyancing requirements thoroughly, and that incorporates a specially edited version of the Law Society Commercial Conditions (3rd edition) of Sale."
Option to Buy Land and Property: additional price
Read what Net Lawman says about this template:
"This option contract is for a situation where the ultimate sale price is not known in advance but is calculated after the event. For example, the buyer of the option wants to attempt to obtain planning permission. The seller wants a fair price - he does not want to see the buyer walk away with too large a share of “his” land value. This agreement includes provision for the exercise price to be paid in stages as the buyer's development proceeds. This enables the seller to share in any uplift in valuation between the date of the grant of the option and the (later) exercise date. The price paid to the seller is calculated as a proportion of the increased value. The exact proportion is a matter for negotiation, reflecting the difficulty of raising the value and the risks and cost to the buyer in time and money. The template also includes a detailed sale contract incorporating the Law Society's Commercial Conditions (3rd edition), with amendments tailored to this precise deal."
Option to buy land and property: standard
Read what Net Lawman says about this template:
"This is a comprehensive agreement that gives one side an option to purchase real property - land or buildings - in a straight forward deal where the price and the exercise date are both fixed. The document incorporates a specially edited version of the Law Society Commercial Conditions (3rd edition) of Sale. Acquiring an option to purchase land or buildings for development, rather than buying outright, allows a buyer to minimise risk, whilst at the same time providing the seller with a payment regardless of whether the buyer exercises his or her option. It can help incentivise a land owner to cooperate in securing the future event the buyer is seeking and, depending on the sale price agreed, let the buyer purchase at a discount to future market value."
Option to Buy Land and Property: extension of term for a fixed length of time
Read what Net Lawman says about this template:
"This agreement creates a call option where the developer buys the right to purchase the property at a given price within a certain period of time. It also includes a provision for extension of the exercise period for a fixed length of time in return for an additional payment to the seller. This document is likely to be used in situations where an event for which the option holder is waiting (such as grant of planning permission) could be delayed, and the holder wants to reduce the risk that his or her right to buy might end before the event."
Option to Buy Land and Property: simple
Read what Net Lawman says about this template:
"This agreement is specifically drawn to be short and simple, for situations where it is important not to present the other party with a long, legalistic document that he may worry about. This document does create a legally binding contract, but does not tie up the loose ends as our other versions do, and does not offer as much protection for the buyer from the unexpected. It is, however, short, written in plain English and therefore easy to understand."
Option to Buy Land and Property: in multiple phases
Read what Net Lawman says about this template:
"This agreement is for a single deal where the buyer may achieve a substantial increase in land value but only in stages - for example, a phased development of a residential site. The effect of phasing the deal in this way is that the land owner receives his or her proportion of the full value but the developer can work piece by piece. This deal allows each party to maximise his or her share. To make it work, the area and location of each proposed phase must be identified on a plan. This document is suitable for buying any type of real estate, from agricultural land to derelict warehouses."
Overage Agreement: seller version
Read what Net Lawman says about this template:
"This document is for a property seller. It could be used for any land deal, regardless of value. Use by incorporating it in to the contract for sale or as a stand-alone agreement. As every property professional knows, overage is a useful device to obtain the maximum value from the sale of land. The buyer can buy at a low risk cost and the seller will ultimate share the future development value in the agreed proportions. This agreement provides for repeated payments over however many years you wish. Because the base value is always calculated for the date of the planning permission, the original seller has an inflation-proofed investment."
Overage Agreement: buyer version; concessionary
Read what Net Lawman says about this template:
"Most overage agreements are favoured by property sellers in order to obtain the maximum present and future value from the sale of their land. This agreement has been written for a buyer, because it is more likely than not that in a speculative offer, it is he or she who initiates the deal. It is therefore strongly in the interest of the buyer to produce the contract in a version he or she can live with. The parties can then negotiate the finer points based on that document. It is suitable for any land deal, regardless of value. The terms could be incorporated in the contract for sale or the document could be used as a stand-alone agreement."
Overage Agreement: buyer version; simple
Read what Net Lawman says about this template:
"This agreement has been drawn for a property buyer to present to a prospective seller as an offer and around which the sides can negotiate a final contract. It is a comparatively simple version in which the seller’s rights do not pass from the present buyer to a future buyer. The effect is that the present buyer is bound for the overage period, but can sell a title “clean” of attached overage. Furthermore, to make calculation of the charge simple, it bites only when a planning consent increases the land value by a given (substantial) sum. It thus avoids the possibility of multiple small charges. The aim of this agreement is to provide a framework that entices future owners to develop the property, and not one that ensures that they do not."
Detailed guidance notes are provided with each template. Net Lawman offers a money back guarantee if the document is not what you need, as well as a legal review option if you want some professional assistance when you are drawing up your documents.
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