The Land Registry have become so concerned about bogus land banking investments scheme they have published a free guide (Public Guide 21)

Land banking is a means of investing in land. The land banker purchases land in anticipation of being able to acquire planning permission. Once a viable planning permission is obtained, the land is developed and sold for a profit. 

Land bank investment schemes, or “plot land development schemes”, are often created by unscrupulous land bank companies (LBC) who buy the land, break it down into smaller plots and entice buyers with claims that there will be substantial returns once planning permission is granted.

In reality these schemes often involve green belt land or agricultural land for which planning permission is unlikely to be granted.

The Land Registry has identified other misleading claims that a LBC may make. For example, an LBC may:

• Claim that they are in partnership with well known banks and/or developers, when this is not the case.
• Wrongly claim that planning permission has been granted and/or back these claims with forged documentation.
• Sometimes the “plots” are based upon Land Registry approved estate plans which are used to suggest that formal approval has been obtained for the site.

So when an investment looks to good to be true it probably is. 

If you are in any doubt about the viability of any property schemes please call us for further advice.

See: http://www1.landregistry.gov.uk/assets/library/documents/public_guide_021.pdf. for further details.