Selling Charitable Land

Following on from our update last month, it seems these changes are coming into force.

There have been regulations and restrictions about selling charity land for many decades now and the regulations have been revisited a number of times; the latest revisions are due to land this month (June 2023) and aim to provide a bit more flexibility whilst retaining the required protections.

The restrictions and regulations aim to ensure that charitable land is only sold at a market price and currently require a chartered surveyor to provide a section 119 Charities Act 2011 report which had specific requirements as to advertising the property for sale and the surveyor’s assessment of best market price, anything that could be done to enhance the value and any other matter that should be drawn to the trustees’ attention.

The new regulations are less strict – a chartered surveyor is no longer required, but a “designated adviser” who can self certify that they have relevant local experience to provide the report.

It’s not a free for all however and the “designated adviser” if not a chartered surveyor must be:

• Either a Fellow of the Central Association of Agricultural Valuers; or
• Member of NAEA Propertymark (the professional membership scheme for estate agents, formerly called the National Association of Estate Agents/NAEA) at fellow grade.

The new regulations will also allow a charity trustee, officer or employee to provide that report if they are employed by the charity for that purpose.

The regulations will also require the charity to confirm in the sale contract (as well as the transfer) that it has complied with its obligations – this is to ensure the buyer under the sale contract does not lose out because the charitable seller has only realised late in the day that it should have obtained a proper report and to in effect make sure all parties are aware before there’s a contractual commitment that a report must be obtained.

If you are a charitable trustee looking to sell charity land, or a buyer wanting to buy land from a charity then please take advice from our commercial property team to ensure the regulations are complied with.