High property prices are prompting auction buyers to seek out unconsented and challenging plots of development land in search of returns.
Allsop residential partner Richard Adamson said there had been an increase in investor appetite for awkward parcels of land as a result of intense competition for less risky assets.
He said: “Smaller sites in London are becoming more popular, because prices are at a level at which more difficult sites and smaller sites are more feasible for developers to build on.”
The Land Registry House Price Index for October found that UK house prices rose by 0.4% in the month and 5.6% in the year to date to an average £186,350.
London prices rose by 1.8% in October and 10.6% annually to an average of £503,431.
Adamson said: “Sellers, local authorities included, now recognise there is demand for smaller sites, and sites they thought weren’t sellable.”
At Savills Nottingham’s most recent sale on 22 October, a 0.8- acre plot in Peterborough was sold for £168,000 off a £75,000 to £85,000 guide.
In September, a 0.2-acre orchard near Southwell, Nottingham, at the end of the seller’s garden, sold for £70,000 off a guide of £10,000 to £15,000, and a 0.3-acre site in Milton Keynes, guided at £1,000, sold for £26,500.
Savills’ associate director of commercial auctions, Paul Giles, said he was seeing a particular demand for plots offered at £1,000 to £10,000, often with access tracks and rights of way to neighbouring properties.
CPBigwood partner Ian Tudor added that government proposals to overhaul planning laws could lead to an even greater interest in small plots.
