Pricing a parcel of land is indeed a tough decision for many land sellers. Underpricing or overpricing your land can both put you in a bad spot when it comes to marketing your land. On the one hand, you don’t want your property to sit for a long time without any interest. However, you also don’t want to be left with the feeling that you left money on the table.
Thus, it’s necessary to offer just the right amount of price to sell the property in a timely fashion for the most profit possible.
For a seller to get a successful sale and for the right price, there should be research on the valuation of the property before it’s listed. Knowing the value of the property is absolutely necessary for you to price it correctly. Aside from the value of the property, you also have to delve into these following factors to come up with the right price and get a successful sale.
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Looking into the conditions of the real estate market in your area is crucial as it allows you to see a clearer picture of the various trends that may affect your land sale.
By studying the market, you’ll get a snapshot whether it is going uphill or downhill, and this factor may help you decide if it’s the right time to sell your land or you’ll have to adjust the price of the property to attract buyers.
A real estate market that’s going well is a favorable situation to sell your land as there’s more demand for properties. However, even if the market looks improving, you may encounter dips along the way. get tips for Irvine Homes For Sale.
In the case when the market is at its downturn, you’ll need to offer a competitive price of the property to sell it successfully. Of course, you can also opt to wait for the market to recover, but this option may lead you to price your land even lower, especially if the improvement you’re waiting comes longer than you expected.
Comparable Land Properties Currently for Sale
One way or another, the properties currently on sale in the market have undergone the same pricing process that you’re undertaking. Thus, having a comparative analysis of the overall land inventory in your area can somehow help give you an idea of how much you should price the land you’re selling
However, you must be sensible with your analysis. Most sellers tend to price their property a bit higher than the prices of comparable active properties in the market, thinking that they have unique and more valuable properties to offer. This move often results in driving away potential buyers and failing to get a quick, profitable sale.
As a seller, you have to ensure that the comparable active properties in your area are not sitting for a long time without buyers since it means that these properties are overpriced or simply unattractive in the eyes of the buying public.
Not all properties are equal. Although looking at the prices of comparable properties currently for sale in your area is one of the factors you should consider when pricing your property, the prices that other landowners are currently offering doesn’t automatically determine the market value of your land.
Comparable Land That is Recently Sold
I can say that analyzing comparable recently sold properties is more practical than looking at similar properties currently for sale. After all, real estate market value depends on sold properties, and sometimes it’s a blunder to base the price of your land on comps that are not sold.
You may look at similar lands that are recently sold within a mile of the location of your property, especially if it’s located in a densely populated area. If the location of the property is in the countryside, you may have to search for comps within a radius of several miles.
Lowering the Price for a Quick Sale
It’s undeniable that a low-price land will surely catch the attention of many potential land buyers. However, you should see to it that you’re not getting the short end of the stick. Aside from the market value of the property, you also need to take note of the various costs that come with selling the property.
There are attorney’s fee, land surveyor’s fee, agent’s commission, rates and taxes clearance certificate, and other expenses you have to pay for the sale. That’s why if you consider adjusting the price down, you should make sure that you still get profit from it.
Hiring a Professional Appraiser
Local realtors and property appraisers can suggest to you the market value and price of the land you’re going to sell. These experts use different appraisal methods – such as income capitalization approach, cost approach, and sales comparison approach – to determine the value of the property.
Hiring a professional appraiser assures you that you’re pricing your property correctly so that you can sell it at the right time with the right price.
For most land sellers, it’s indeed a challenge to come up with the right price of the property they’re selling. It’s because pricing mistakes can often derail or break the sale of otherwise valuable property. Therefore, you need to know about the pricing considerations mentioned above when selling your land.