Land Finance Rates 2026 — Updated October 2026
- Land with detailed planning — experienced developer exit (Oct 2026)
- 0.70%–0.95%Land with detailed planning — experienced developer exit (Oct 2026)
- Land with outline planning — planning risk reduced but not eliminated
- 0.95%–1.20%Land with outline planning — planning risk reduced but not eliminated
- Land without planning — speculative position, highest rate
- 1.10%–1.40%Land without planning — speculative position, highest rate
- Planning status determines LTV — from 40%–50% (no consent) to 65% (detailed planning)
- LTVPlanning status determines LTV — from 40%–50% (no consent) to 65% (detailed planning)
Land finance rates in October 2026 range from 0.70%/month for land with detailed (full) planning permission and an experienced developer exit, to 1.30%+/month for greenfield land without planning consent. The rate reflects the lender's assessment of the land's value risk — which is directly linked to planning status. Land with planning permission has a deterministic, evidenced value. Land without planning permission has a speculative value dependent on an uncertain planning outcome. The further from planning permission, the higher the rate and the lower the LTV.
Land Finance Rates by Planning Status — October 2026
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| Planning status | Rate range/month | Max LTV | Lender availability | Key risk factor |
|---|---|---|---|---|
| Detailed (full) planning permission — residential | 0.70%–0.90% | 60%–65% | Good — multiple specialist lenders | Build cost overrun and sales risk only. Planning risk eliminated. |
| Detailed planning — commercial | 0.80%–1.00% | 55%–60% | Moderate — specialist lenders | Occupier demand risk. Planning risk eliminated. |
| Outline planning permission | 0.90%–1.10% | 50%–60% | Moderate — specialist lenders | Reserved matters approval needed. Timeline risk. |
| Pre-application advice received, no consent | 1.00%–1.20% | 45%–55% | Specialist lenders only | Planning risk remains. Pre-app not a grant. |
| No planning consent — but evidenced prior refusals managed | 1.10%–1.30% | 40%–50% | Specialist lenders only | Full planning risk. Lender relies on land fundamentals. |
| Agricultural land — no planning | 1.10%–1.40% | 40%–55% of agricultural value | Very specialist | Agricultural value is the floor. Planning uplift speculative. |
| Land with implemented planning (works started) | 0.70%–0.85% | 65%–70% | Good appetite | Implementation lowers risk — planning less likely to lapse. |
What determines your rate
Why planning status dominates land finance pricing
Land value is primarily a function of what can be built on it. Land with detailed residential planning permission is worth 3–10× the value of equivalent agricultural land without planning. A lender advancing against land values the security on its current planning status — not on the hoped-for outcome of a planning application. This is why the LTV on unplanned land (40%–50% of agricultural or current use value) looks conservative: the lender is protecting against a scenario where planning is refused and the land reverts to agricultural use value.
Pre-planning bridge — highest risk, highest return potential
Pre-planning bridges (acquiring land before planning is obtained) are used by developers and land promoters who believe a site has strong planning potential. The acquisition price is typically at or near agricultural/existing use value. If planning is subsequently obtained, the land value can increase 3–10x. The finance cost (1.10%–1.30%/month) is high — but the potential uplift dwarfs the cost. DBF has arranged pre-planning bridges for land promoters who subsequently achieved planning permission and significant capital gains.
Agricultural land vs residential land — the planning uplift
Agricultural land in South East England trades at approximately £8,000–£15,000/acre. The same land with detailed residential planning permission may be worth £500,000–£2,000,000+/acre depending on location, infrastructure, and scheme density. Lenders advance against agricultural value on unplanned land — not against the speculative planning gain. The planning application process (6–18 months for a residential site) is funded by the land finance during the hold period.
Exit strategies for land finance
Land bridges have two primary exits: (1) obtain planning permission and sell to a housebuilder or developer — the land price uplift provides the repayment. (2) Obtain planning permission and develop the site — the development loan repays the land bridge. Most lenders want a clear exit strategy evidenced at the time of lending. DBF assesses exit viability as the first part of every land finance enquiry.
Worked cost example
Agricultural land, 3 acres, Hertfordshire. Pre-planning acquisition. Price: £135,000.
Agricultural value per RICS: £45,000/acre. Planning potential: 12 residential units at £350,000 GDV/unit = £4.2m.
Land bridge: 50% of agricultural value = £67,500. Rate: 1.20%/month.
15-month term (planning process). Interest: £12,150. Arrangement fee (2%): £1,350. Total: £13,500.
Planning permission obtained (month 14): outline for 12 units.
Land now valued at £800,000 (planning uplift). Sold to housebuilder at £780,000.
Bridge repaid (£67,500 + £13,500). Developer profit: £780,000 - £135,000 - £13,500 = £631,500.
Note: DBF advised on exit strategy and confirmed lender appetite for this planning promotion case.
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The figures above are indicative and describe the best case. Send your own scenario and we will come back the same working day with terms from the lenders that actually fit it.
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Rate context and outlook
Senior development finance currently prices from about 8.8% a year for low-leverage ground-up schemes, with most facilities at 9.5%–12%. Bank Rate is 3.75% after the 17 September hold; development lenders price off their own funding costs, so rates have stayed stable through the September swap-rate rise, and some lenders cut margins over the summer.
Lenders now expect tighter information on build costs, drawdowns and exit before committing.
Reviewed by David Doulton, Director, Doulton Bridging Finance — over 20 years in property finance. Last reviewed 1 October 2026. Doulton Money Ltd t/a Doulton Bridging Finance, FCA No. 814533.
Frequently asked questions
What rate does land finance cost in October 2026?
Land with detailed planning permission: 0.70%–0.90%/month at 60%–65% LTV. Outline planning: 0.90%–1.10%/month at 50%–60% LTV. No planning consent: 1.10%–1.40%/month at 40%–50% of current use/agricultural value. Arrangement fees are typically 1.5%–2%.
Can I borrow to buy land without planning permission?
Yes — specialist bridging lenders will advance against land without planning permission, at higher rates (1.10%–1.40%/month) and lower LTV (40%–50% of agricultural or current use value). The exit strategy must be credible — typically planning permission to be obtained and land sold or developed. DBF identifies the specialist lenders with appetite for pre-planning land cases.
How is LTV calculated for land without planning?
Lenders use the current use value (typically agricultural value for greenfield land, or existing use value for previously developed land). They do not use the potential value after planning is obtained — that value is speculative. At 40%–50% LTV of agricultural value, the lender is well protected even if planning is refused.
What is the maximum LTV for land with planning permission?
With detailed (full) residential planning permission: typically 60%–65% LTV of the market value with planning. Some specialist lenders extend to 70% for land with planning and an experienced developer. With outline planning only: 50%–60% LTV.
Can I finance a residential land purchase as a first-time developer?
Yes — but the lender panel is more restricted for first-time developers. Some specialist land lenders require a proven track record. Those who accept first-time developers typically require a stronger planning position (detailed planning preferred over outline), a credible professional team, and a larger deposit (35%+). DBF advises on the most accessible land finance for first-time developers.
How are funds released?
In stages as the build progresses, usually in arrears, after a monitoring surveyor confirms the work is done.
Do I need planning permission?
Senior development finance usually requires full planning; sites without it are funded with land bridging first.
How long does it take to arrange?
Usually 4–8 weeks, depending on valuation, the monitoring surveyor and legal work.
What is the difference between LTGDV and LTC?
LTGDV compares the loan with the finished value; LTC compares it with total costs. Lenders apply whichever is lower.
What if the build overruns?
Lenders expect a 5%–10% contingency. Overruns beyond it are usually funded by the developer, or by agreeing an extension.
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Independent whole-of-market advice · FCA No. 814533