What is a Compulsory Purchase Order?
You may think that you own your purchased property and especially if it comes under freehold. You own whatever is on that land (freehold) be it buildings, crops or even a fishing lake… but, you don’t always so I need to explain to you the meaning of Compulsory Purchase Orders. It’s rather rare – though it does happen!
Upon purchasing your property be it leasehold or freehold and everything in between, you will be comforted in knowing that you are now the new owner and that no one can take that away from you be it a straight cash purchase or so long as you keep up with your monthly payments such as for your mortgage. Unless you decide to sell or default on loans then you will remain the king of your own castle. As much as that rings true for most of us, there are countless horror stories where owners of property have lost whole or part of their land/property under a compulsory purchase order and they never had a say in the proceedings.
A Compulsory Purchase Order (CPO) is where the government or other public bodies are able to take part or all of your property for what is classed as the greater good. You will be paid compensation though this is usually no where near the correct financial amount required. Situations where CPO’s occur is for the likes of transport (new roads / rail tracks) or utility services where land or buildings are needed in order to facilitate new routes / widening of routes etc.
It is highly unlikely that you get a knock on the door with a demand to acquire your property there and then, prior notice is given and even then the party in question will have to take their case through councils and if needed parliament for large CPO’s. You can challenge CPO’s and there are legal teams that specialise in such cases – You can challenge a CPO in the High Court under the Acquisition of Land Act 1981.
The public body in question will have to approach the purchase of your house just like any other sale procedure and if you are fully prepared for such dealings then at times, depending on the advice you have been given, you can achieve a decent price of sale. There are times where part CPO’s can heavily effect the value of a property and especially for such cases where new routes are placed alongside existing land / property – Again, compensation can be sought. Another area which can devalue property is when proposed CPO’s which are lengthy to come to fruition put what is termed as a blight notice which is a reduction of home / land value due to looming CPO. Businesses can also suffer such as for instance where part of farming land is acquired that may have held valuable crops such as vines for wine making.
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