Option or promotion agreement: which should you choose?
In shortChoose an option when the site is small, a buyer is already known and you want the price fixed now. Choose a promotion agreement when the site is large enough for several housebuilders to compete and you are content to wait for an open sale. Under both the developer pays for planning and you keep the land if it fails.
| Ask yourself | Option | Promotion |
|---|---|---|
| Is there a known buyer already? | Yes. The option sells to them | No, the market finds one |
| How big is the site? | Up to about 25 homes | Usually larger |
| Do I want the number fixed now? | Yes, as a figure or formula | No, the sale sets it |
| How long can I wait? | Two to five years | Five to ten |
| Who sells at the end? | You, to the option holder | You, to the bidder |
| What if it fails? | Option lapses, you keep the land | Agreement ends, you keep the land |
Most of the land we see is on the option side of that table: one to six acres, a village edge or a backland plot, a buyer we already hold who wants exactly that. We say which we think fits your land in the written view of value and why. Both agreements in plain words.
Questions landowners ask
Straight answers
Which is better for a landowner, an option or a promotion agreement?
Neither in general. An option fixes the price early and suits a small site with a known buyer. A promotion agreement suits a larger site where an open sale would bring competing bids. The right one depends on the land.
Can I have both?
Hybrid agreements exist, where the developer may buy at a formula price or choose to promote and sell. They need careful drafting and are more common on large sites.
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