Want to sell your land? What to expect

Selling a home in a competitive Real Estate market can be challenging. Sell your land can be even more daunting…even in a good market. Land is a completely different animal and requires that the seller be prepared to meet the challenge. You simply cannot stick a sign on your vacant land and expect buyers to rush you. Hopefully you find the following useful.

The Land Market and why it’s different

Many sellers expect the vacant land market to be more of less like the residential homes market. THEY ARE NOT! The land market is quite different than the residential homes market in a number of ways. As a seller of vacant land, you’ll be better prepared if you are aware of these differences thereby enabling you to address them.

1. Land buyers are different from home buyers

Home buyers typically find third party financing – such as a bank – to finance the transaction enabling the seller to receive cash on the day of closing. Not so with land buyers. Banks typically do not lend on land. This puts the land seller in a prickly position to try and find a cash buyer. Let’s face it – there are not many folks with a stack of cash looking to buy land. Another option is for the owner to finance the sale for the buyer. This will require the seller to provide all the necessary paperwork, deed, Deed or Trust (or Mortgage), Promissory Note, disclosures, etc. This is burden for most seller as it is a very real possibility that the buyer stops making payment on the note resulting in the seller having to foreclose resulting in court costs and sleepless nights.

2. Land requires different sales techniques

A typical home buyer will fall in love with the kitchen or bathroom or master suite of the home they are trying to buy. In other words, each home is different than the other and there is something unique about the home that will cause the home buyer to buy. Land is different. One piece of land is not that different than the one next to it. What will cause a buyer to buy yours as opposed to the one next to yours? Again, it comes down to price and terms as discussed in (1) above.

3. The land market is a lot less active

This goes without saying. Anyone knows that a lot more folks will be looking for homes than for land. After all, they are looking for a roof over their heads whereas land is a speculative investment.

4. You must have patience to sell your land

Selling land requires a lot of marketing (read that as costing money). You can list it with a realtor, of course. But think about it – where would a realtor spend his resource? On finding buyers for the 3 land listings he has or for will he be trying to find buyers for the thousands of homes listed in the MLS? That’s a no brainer.

It is not difficult to see the challenges a land seller faces when he/she is attempting to sell his/her land. Land produces no income and actually cost the owner by way of property taxes and HOA fees while at the same time offers no depreciation benefits like a residential home. It is not hard to see why there are a limited number of land buyers who are serious about buying.