How do I sell land fast? We hear that question often, and it makes sense. Perhaps you recently inherited some land and you prefer some quick cash, or maybe you had an expense or investment opportunity come up and you would like to liquidate some of your portfolio quickly.
Whatever the reason, selling your land fast requires some understanding of the market as it is different than selling a home. Below we discuss what to expect in a land sale process, the pros and cons of each approach and how to sell your land fast.
I want to sell my land, what should I expect?
Land market dynamics are quite different than what you encounter in the home buying market. Understanding these dynamics will help minimize any frustration.
- Selling land will take time – the land market is generally less liquid than the house market and you should expect that your land will take time to sell. Don’t be surprised if it sits on the market for a year or more.
- Land buyers are different – there is a broader range of land buyers. Some are looking to build a home, others are looking to use it for recreational purposes and some just want to add it to their investment portfolio. Contrast that with home buyers, where they are looking for a more narrow set of requirements such as being turn-key, nice kitchens and bathrooms, etc.
- Traditional financing sources are limited – Traditional lenders typically don’t like land as an asset because it doesn’t generate cash flow. Therefore, it is often required to provide owner financing to expand the pool of buyers for your land. This, of course, presents a challenging situation if your prefer to receive cash fast for your land.
- Land has different sales channels – With homes, you typically simply hire an agent to put it on the MLS and you will start to get interest from buyers. With land, the buyers aren’t as organized all in one place. It takes a broader strategy to find buyers.
How do I prepare to sell my land fast?
Be ready to spend the time needed to prepare a thorough listing and to be able to talk to prospective buyers about all of the aspects of the land. Below are a few items you’ll have to consider:
- Zoning – What is the zoning on the property and what is permitted? Land buyers will have specific use cases and you’ll need to be prepared with information about what is allowed and what is restricted.
- Is the title clear? – In the land market, title issues are much more common as typically the value of the properties are lower so many people forego using title companies / attorneys to close to save some money, but create title issues in the process. If you inherited the land, be sure to check with your attorney to confirm all of the proper legal processes and documentation were completed correctly or you may find your buyer leaving once they learn about any title issues.
- What does the land look like? – Often vacant land is quite remote so there aren’t any recent pictures of the land available. You’ll typically have to get the GPS coordinates of the parcel from the county and use an online mapping application like Google Maps to get driving directions to the property. Or you can hire someone online to go take pictures of the property for you. Also, understand the attributes of the land. Is it flat? Does it have trees? Is there a river or lake nearby? Knowing how to market the property with its positive attributes will go a long way when trying to sell the property.
- What kind of access does the land have? – How hard is it to get to the land and what kind of road does it have, if any?
- Will you offer owner financing? – All cash transactions typically take longer given there are fewer people that can afford the entire amount up front. Does receiving payments over the next few years fit your needs? You’ll also need to take the time to learn about owner financing legal documentation.
- What price for the land? – Pricing land is more difficult than homes as there are more comparable homes and readily available data. Take the time to research land prices and benchmark that to how long it took to complete the sale. Pricing too high will keep buyers away, so you may be able to get a bit more for your land but it may take a year or 18 months to do so. Think through the pros and cons of speed vs. maximizing value relative to your needs.
- Any utilities available? – Utilities at the property line or in the area can impact the value of the land.
What are the options for selling my land?
So now you have taken the time to do all the research and you are now prepared to start marketing your land for sale. What are the general approaches?
- Use a real estate agent – The same way as you would when selling a home. While this may make sense for very high dollar land (e.g., $100,000), it probably doesn’t make sense if the land is only work a few thousand dollars or so. Why? Because real estate agents are paid on commission and their payout on small dollar land deal isn’t all that attractive. It can still be done, just don’t be surprised if they focus on higher commission opportunities. Because of this dynamic with agents, the MLS is not the ideal listing location for lower value land. They will have to do the same amount of work for very little commission.
- For sale by owner – You can list your property for free on a site like Zillow.com and see if you get any interest. The problem is that these sites are geared towards home buyers and are flooded with low quality land listings that have been sitting on the market for years. You’ll likely have to be priced very low and offer owner financing to sell fast. There are other places to market land online, but often they require significant monthly listing fees which won’t make economic sense if the land isn’t worth that much.
- Sell to an investor – There are investors that buy land in bulk so they offer the ability to buy your land with cash. The difficult part is finding an investor with the capital and experience to close your transaction fast.
So, what is the best way to sell land fast?
If your goal is to minimize hassle and receive cash for your land as quickly as possible then selling to an investor is the best way to sell land fast. Typically, investors are well-versed in the land market and can quickly assess your parcel of land and come back to you quickly with an offer. This will save you all the time and money required to research the property, market it and deal with buyers. The trade-off, of course, is you likely won’t get the highest price in the market. But if you prefer speed and certainty of close over value maximization, then selling to an investor is usually your best bet.
We can buy your land
We are experienced land investors and we can make you an all cash offer and close fast. Feel free to contact us with the details of your land and we’ll make you an offer.