You have a land for sale? In this guide we have 5 practical tips for a successful real estate sale.
If your property is a designated building land and is located in a city or close to town, then the sales opportunities are excellent. Naturally, urban locations have only limited land available, there are hardly any gaps. At the same time, demand is usually high.
There are basically two target groups for the sale of a property; private individuals who want to realize their dream of owning a home, or property developers and project developers who want to realize their own construction projects in order to subsequently market them.
Most important for the buyer is to know how he can use the land.
1. Land for sale – Which marketing strategy to choose?
When marketing a plot of land prospective buyers should be informed about the details of building feasibility and different project perspectives to be developed (for example, building a detached house vs. erecting two semi-detached houses). If the size of the plot allows for only one or two units, both individuals and developers should be addressed in the marketing as both groups qualify as buyers. A real estate agent can develop the marketing concept.
If the plot is very attractive, the best-selling price can be obtained through a bidding process that sets a minimum bid and asks the bidder to bid higher. Bidding procedures should normally be carried out by market intermediaries. It is traditionally carried out by real estate agents who have already sold land more frequently and know the most important property developers in the region.
2. Developability of a property as an indicator of recoverable sales price
At what price a property can be sold, can be deduced most likely from the buildability of the property. In principle, the more living space it can have, the higher the sales price.
It might be a good idea to contact an architect to develop a possible building concept. Please keep in mind your target groups. If the land is good for both, the best is to show a sketch for each possibility (for example, a detached house as well as an apartment block). Probably, the architect is able to advice you on how much density can be build on your land.
3. Make a pre-application before selling the property?
In the event that the building feasibility is unclear because there is no qualified development plan and the buildability does not clearly result from the surrounding buildings, it may be useful for the seller of a plot to make a pre-application before marketing the property.
In the case of a pre-application to the planning department, the requesting party submits proposals for development to the building authority and then receives an official notification, which gives legally binding information on the buildability. Although the pre-application is costly and may take a few weeks, it facilitates the sale of a property.
4. Have all the legal documents in order
Before marketing your land for sale, you should put together all necessary documents. Usually, they are made available to the real estate agent and when it comes to the sale they will be given to the notary. As a result a buyer who decides to go ahead with the purchase will not need to wait. Unfortunately, it happens often that a buyer gives up because of the long waiting time to get all the needed documents in order.
5. How much is my land worth? – How to come up with the right price
There are different procedures to determine the value of a land. The method used depends on the type of property.
First of all, the comparative value method: The comparative value method sets the property in relation to similar properties that were sold in the same location. This procedure usually applies to privately used residential land.
In contrast, the earnings value method: This method is used primarily for land in which the future yields achievable by the land are taken into account for the value of the land. Examples of this are residential properties that are for rent or commercial properties.