5 Reasons Selling Land By Owner Can Be a Big Mistake
Your land is one of your most valuable assets. So when it comes time to sell, get the most out of it by using every available resource to get market value or higher. And without stressing over tricky transactional details or marketing.
1. You think you’ll save money on commission, but it’s not that simple
From the very start, we handle everything for you – top quality photos of the land or home, property descriptions and even helping you set the right listing price. Some of our agents even set up trail cameras on your property so buyers can see the quality of deer on the land. While doing all this work yourself may save a little money on commission, it will end up being more costly than an agent’s commission, and you’ll net more money in the long run.
2. Negotiation is a skill built on knowledge
Buying and selling land is not only a huge financial decision, it’s a very personal one as well. Being able to set your feelings aside and speak to the land’s monetary value is crucial. Buyers will try to challenge you or even downplay assets of your land as a tactic of negotiation. Our knowledge of the land market, the average price-per-acre in the area, and what comparable properties have sold for will arm us to negotiate with even the toughest buyers on your behalf.
3. Guidance throughout the process is invaluable
Once you’ve made the big decision to sell your land, there are many other decisions to follow. When should you list it? What price to ask? Are there small improvements or work can increase the “curb appeal”? The list goes on. Remember, you are not just selling the land; you are selling any possible income opportunities. You may not be currently farming the land, mining the timber or mineral rights, or enrolling it in CRP, but other buyers may be looking for land with those potential attributes. You’ll want to make sure the land is marketed to appeal to a variety of buyers.
The little things make a huge difference when it comes to closing a sale for fair market value.
4. Legal, Finance and Tax issues are tricky
Every real estate transaction is unique. Cash, bank and owner-financed contracts are all structured differently. You might be surprised to hear that it’s usually after an offer has been accepted that a deal has the greatest risk of falling apart. Buyers are getting their financial ducks in a row, and that’s not the easiest process. They may not be able to get approved for the offer price you accepted and will ask to renegotiate.
This is when sellers without representation are likely to make hasty decisions in an attempt to avoid starting the process all over. A seller might feel pressured to come down in price or finance the difference themselves. Neither is a winning option, but the latter is better as long as the deal is done right. To avoid this back and forth all together, we always prefer to deal with “pre-approved” buyers.
For example, Bob is selling a piece of hunting land for $100,000. He accepted an offer from Tom for that amount. Tom goes to the bank and only gets approved for an $85,000. Tom comes back to Bob and asks if he’d take that for the land. Bob says no. But he will take the $85,000 and a “note” for $15,000. Bob structures a typical seller-financed contract. The promissory note states Tom would pay Bob back monthly with 7% interest over 36 months (all these terms are negotiable). It’s complicated, but it’s creative. And in a seller’s market, you sometimes need to be creative to close deals that work in both parties’ favor. We are well-versed in complicated transactions and will always work to protect your investment
Any timber rights, water rights, road access, easements, and mineral rights also need to be worked into the contract. There are also ways to work around certain taxes that could keep some cash in your pocket. We are pros at this stuff, and we have a network of attorneys, land surveyors, bankers and accountants we can call at any time.
5. Established relationships with buyers
Our network is expansive. Before your land is even listed, we may already have a buyer lined up who is willing to pay the market price. Over the years, we have not only built relationships with investors, we also have buyers waiting who are searching for the perfect 50, 100 or 300 acres of land to hit the market. This means you can sell without stress or headaches, and move on with your profits quickly. In the end, this is the sole purpose our company was created. We bring together buyers and sellers of hunting, ranch and farm land.
To learn more about our land selling services, check out the video below: