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I've observed something that I wanted to get some viewpoints on. It's not uncommon to see a piece of vacant, raw land for sale and sit on the market for a long period of time.
Obviously, if the land is very difficult to develop (most of it is in a flood zone, it won't "perk" with no access to utilities, etc.), then the land is going to be a very tough item to sell. Or if an area is extremely rural with little/no movement of people into it, or demand for jobs, economically depressed, etc., it's going to be hard to sell it relatively quickly.
But I've seen land that seems to be in a pretty good location, having access to utilities, not a flood area, or having no known major defect, that sits on the market for year (some properties for 5+ years ). And these aren't FSBOs, a realtor is listing them (maybe the asking price is too high??).
If anyone had land they wanted to sell in light of this challenge, what are some strategies that would expedite the process of getting it sold?
We've had parcels for sale in our town for decades.
They're usually on a busy street but zoned residential. Most of the inquiries to the realtor usually are from developers who want to build commercial. The neighbors who still live nearby don't want it rezoned to commercial, and the elected officials heed that. So it stays for sale until ...
We've had parcels for sale in our town for decades.
They're usually on a busy street but zoned residential. Most of the inquiries to the realtor usually are from developers who want to build commercial. The neighbors who still live nearby don't want it rezoned to commercial, and the elected officials heed that. So it stays for sale until ...
I also wanted to expand in this point. Sometimes even to build residential. The amount required to do the utilities can run in tens of thousands of added cost. I looked into buying a undeveloped property to build a house and the electrical utility alone was gonna run 12,000. And it was on septic and the new rules were insane to install. I backed out once the costs kept piling on.
Sometimes there are things you can't see.........like so many easements running through the property - with required setbacks.......you'd have to build a spaghetti house.
Other times there are deed restrictions. There's a most gorgeous 12 acre parcel.......with fabulous water views near me..........for sale.........cheap money considering the size of the parcel.........
But the deed restrictions are enough to choke a horse. Plus it would take about $100K to bring in all the utilities.
We've had parcels for sale in our town for decades. They're usually on a busy street but zoned residential. Most of the inquiries to the realtor usually are from developers who want to build commercial. The neighbors who still live nearby don't want it rezoned to commercial, and the elected officials heed that. So it stays for sale until ...
One would think that eventually one of the neighbors would see the benefit of buying the property to give themselves some extra buffer area around their house.
Quote:
Originally Posted by NinaN
Price, price, price.
Right...this is could be a reason why the neighbors haven't done just that if it hasn't sold to someone else (or they want the benefits of having that extra land around them, but just don't want to pay for it ).
Sometimes there are too many owners of small pieces of land. This makes it difficult for a developer to buy it because they end up needing to negotiate with many sellers. And it only takes one seller to mess up the whole transaction.
Financing land is very difficult these days, so if you do not have cash it may be an issue. Secondly, the idea of buying land and holding for the future is not as popular as it was a few decades ago. Land generates no income and may not appreciate as well as other investments. Lastly, price is always an issue. If it is cheap it may be a good investment but if it is not cheap why bother?
The number of buyers who want to build a house from scratch instead of buying one that is move-in ready is fairly small.
If it is a single lot, it isn't of any use to a developer. If it is priced right, it will sell, but it is very common for bare land to take a long time to sell.
Financing on land is much more difficult.
If the area is a high demand area with rapidly escalating real estate prices, those in-fill lots will sell to developers. But if there are plenty of houses all ready to move into, then not many are interested in the hassle of building.
Also a bare lot has to be in a neigborhood nice enough that a newly built custom home won't be overbuilt for the neighborhood.
Often, people will see the increase in development near them and essentially see a huge payday. They price the land too high and have to wait a long time. Or they know it will get there eventually and they are willing to wait as a long term strategy, maybe as retirement funds. You just have to to be careful, especially if it is the first reason as sometimes that last holdout will get passed by and the development around them occurs in such a way that it hurts their position,
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). And these aren't FSBOs, a realtor is listing them (maybe the asking price is too high??). 
).
