4 Things to Know When Selling Land
It’s no secret that the real estate market is red hot, especially in Florida. Homes are selling quickly, driven by a shortage of inventory. But what if you are looking to sell your land in Florida?
The truth is that while the sales process for selling vacant land is very similar to that for a move-in ready home, there are a few key differences which can be challenging, even in an aggressive market.
If you are wondering how to sell your land for cash in Jacksonville, Fl, or other metropolitan areas of Florida please read on!
1. The market for land is much smaller
There are tens of thousands of families looking for new move-in ready homes at any given time, but due to the difficulty and cost of building on a vacant lot, the number of buyers for your vacant land will be small by comparison.
A majority of potential buyers for your land will be real estate investors or real estate developers who have an interest in buying vacant land in Florida for development purposes. These investors and developers have the resources needed to quickly and efficiently build, whereas a majority of home shoppers won’t.
2. Not every lot is buildable
Just because you own a lot in a popular or desirable area, doesn’t mean it’s buildable. Zoning laws, utility tie-ins, and even the type of soil on your vacant land can affect the buildability of a lot. A lot that isn’t buildable will be far less valuable to a land buyer, and will severely handicap your ability to sell your land.
In order to effectively market your vacant land you may have to take additional steps such as confirming your county’s zoning laws, checking with local utility companies on availability of utilities, and even ordering costly surveys and soil sample tests, though there are hassle free ways for selling your lots in Florida. More on that a bit later!
3. Marketing vacant land is difficult
A white picket fence, a wrap-around porch, a beautiful paint job, and a manicured lawn. These features can easily convey value to potential home buyers, and draw the eye to real estate listings both in print and online.
Unfortunately, when selling vacant land, you can’t evoke the same emotional response in buyers. An overgrown lot doesn’t convey the potential of a newly built home, and most buyers aren’t overflowing with imagination.
When competing with the thousands of move-in ready homes, professionally staged, photographed, and beautifully presented, vacant land leaves a lot to be desired.
In order to effectively market your vacant land you may need to have it cleared, professionally photographed, and in many cases may even have to hire a drone pilot to obtain aerial photographs of the land.
This can be costly and time consuming, and may need to be repeated more than once as foliage grows back.
Surveys and maps go a long way as well, as do approvals and permits that could save potential buyer time when figuring out what can be done with your vacant land.
4. Land is hard to finance
A majority of buyers for homes and vacant land alike require financing to fund their purchase. Unlike a move-in ready home however, vacant land buyers may struggle to find financing options, which can limit your pool of potential buyers.
Lot loans or “land” loans are typically the only mortgage product available for vacant land, and many of the nations top lenders don’t underwrite this particular type of loan. Additionally, as with most non-standard loan types, the interest on a lot loan tends to be greater than a conventional mortgage, which can further discourage potential buyers.
One potential workaround is owner financing, in which you as the seller finance the buyers purchase, and are paid for the property over time with interest like a normal mortgage, only you act as the bank! This option, while a great way to help your land sell, can be difficult for sellers who need immediate cash.
Other ways to sell vacant land
Of course the easiest way to sell your vacant land is to a “we buy land” company. These companies are seasoned and experienced in the purchase of lands for sale, and often pay cash, cover closing costs, and charge no commissions or fees allowing you to sell your land fast.
Some of these companies such as Duval Home Buyers may even allow you to sell your land online without any of the hassle.
Be sure to choose carefully when selling land for cash. Ensure that the company you are working with has a history of success and experience in your market, that they have a title company who understands vacant land transactions, and that they make competitive cash offers backed by proof of funds from a reputable bank or credit union.