Has there been a problem with people finding is house in the past?
Is he wanting to put the sign up on land which you own?
Why do you specifically object to this?
Do you get on with your neighbour or do you not speak?
Have you said that you would agree to this and will you agree, if he pays you money for the consent?
The legal situation is that notwithstanding you may have the right over the drive, he is not entitled to put up any signage on land which does not belong to him unless the landowner consents or there is something in the deeds granting the right of access which allows him to do so.
Other than that, regardless of the reason, you are entitled to simply refuse.
What you could do of course is grant him a licence (a licence can always be withdrawn) subject to the payment of, for example, £100 per year. It depends how important it is for him to have a sign in place and how strongly you don’t want it. You are in the driving seat.
Can I clarify anything for you?
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Your understanding is absolutely correct. He may be alleging that it makes his property difficult to find but that’s only because no one knows where it is. He bought a property with the access as it is, and if you don’t want a sign, he is stuck with it, it is a simple as that. If it’s difficult to find, he needs to give people better directions!