Selling Farmland for Housing Development

When a town or village grows, it almost always grows into the fields around it. Councils are required to plan for the homes their area needs, and in most places there is not enough previously developed land to meet that need. So the land that ends up allocated, or approved on appeal, is very often farmland that sits right against the existing edge.

That does not mean every field next to a village will get planning permission. But it does mean that a field used for wheat, barley or grazing today can have a value many times higher if planning is granted. The question for a farming family is whether that is realistic for their land, how long it might take, and whether it can happen without disrupting the rest of the farm.

The national planning rules published in August 2026 made that question more relevant. For the first time, there are national criteria for approving homes outside settlement boundaries, including where a council is not delivering enough homes and the land is physically well related to the village or town. You can read more in our guide to the new NPPF.

Nothing changes on the ground while planning is being pursued. You keep growing crops, grazing livestock or letting the land. Surveyors and ecologists will need occasional access, always arranged with you in advance, and any damage to crops, fences or gates is put right.

Planning can take anything from months to several years, so it matters that the land keeps earning in the meantime. Our agreements are written so that you carry on as normal until the sale completes. The gap between planning being granted and completion is set out in the agreement, so you can plan the final harvest or the end of a grazing arrangement.

Surveys You Might Notice

Some ecology surveys happen at particular times of year: bat surveys in the summer months, great crested newt surveys in spring, and breeding bird surveys in spring and early summer. Ecologists may walk hedgerows, check trees and look at ponds. None of this affects your farming, and you will always know who is coming and when.

Most farming families we speak to want to sell one or two fields, not the whole farm. That is normal, and the agreement can be drafted around it.

The things to think about are access for your remaining land, the location of the new boundary, what happens to water supplies and drainage that cross the site, and whether the development will affect how you use the rest of the farm. A good scheme can often improve things, for example by providing a new access or a better boundary, but these points should be agreed at heads of terms, not left to the end.

It is also worth thinking about future phases. If the field you are selling is the first of several that could one day be developed, your land agent may want to discuss how access and services are designed so that later land is not left without a way in.

Selling land can create a Capital Gains Tax bill and change your inheritance tax position, so it is worth involving your accountant early.

• Capital Gains Tax is charged at 18% or 24% for individuals in 2026/27, after a £3,000 annual exempt amount.
• Agricultural Property Relief only covers the agricultural value of land, not any development value above it.
• From 6 April 2026, 100% Agricultural and Business Property Relief is capped at £2.5 million per person, with 50% relief above that.
• Once land becomes cash, the cash does not qualify for either relief, so what you do with the proceeds matters.

Our guide to tax when selling land for development explains each point, and our agreements give you advance notice of key dates so that you and your accountant can plan.