Selling lots and land differs from selling homes. In the housing market, it isn’t unheard of to see homes listed as “For Sale By Owner.” While we can also see this trend to some extent with lots and land, we do not recommend that sellers go this route.
You might try selling the lot yourself to avoid paying a real estate agent, but that isn’t necessarily the most sensible route. FSBO may seem like a good idea, but it carries a lot of hidden costs. Keep reading to discover seven reasons selling land “For Sale By Owner” is a bad idea.
Marketing Is a Chore
A seller‘s greatest challenge is getting the word out. How can you get buyers’ attention in the age of distraction? Advertising via word of mouth or with a sign in the front yard will not cut it. Unlike a real estate agent, you lack connections. Marketing is more challenging now than ever — especially if you’re trying to handle it on your own.
Sales Takes Time and Effort
As mentioned before, marketing itself becomes a second job — on top of whatever you do during the day. Like marketing, selling itself is hard. Especially for people with day jobs, navigating a work schedule and showing schedule can seem impossible. And, showings themselves are a drag. Not only do you have to schedule the showings but also communicate with potential buyers and show them around the property as they come. The process of selling takes so much more time and effort when you’re doing it alone.
You Might Break the Law
Another problem with trying to sell your land yourself is that you might accidentally do something illegal. And the law doesn’t care whether you did so intentionally. Real estate agents know what the law requires to sell and turn over ownership of a property. There are often licenses, deeds, regulations, disclosures, permits and other important documents you need to fill out to make the sale legal. This can create a lot of hours in terms of research and more bureaucratic hoops for you to jump through — some of it before you even schedule a showing. Save yourself a legal headache and hire a real estate agent to handle the business for you.
You Won’t Make Much Money
Owners often underprice or undervalue FSBO properties. Do you really understand how much your land is worth? Buyers can often sense the lack of expertise and knowledge and can prey on sellers who are unaware of the complexities of selling land for the best price. Many sellers want to save the real estate commission by handling things themselves, but buyers want the same thing. The buyer and the seller can’t both save the commission. Often, that means the seller loses out in terms of final payment. You can prevent this by using an agent.
No One Protects You
Going FSBO might attract some predatory buyers. If you’re not working with an agent, and you have no one on your side, no one can protect you from one-sided deals. Also, as mentioned earlier, you might get caught up in legal issues. By getting an agent, you ensure there will be someone to protect you from any major risks.
Too Many People to Negotiate With
If you go the FSBO route, the number of people you have to negotiate with may surprise you. Besides potential buyers, you could find yourself up against the buyers’ agent (only representing the buyers’ best interests), attorneys, appraisers and banks (with a short sale). Do you really want to bother going through all those people, or would you be better off just working with one — a real estate agent, who can handle the rest?
Sales Take Longer
Besides FSBO sales being harder and making less money, they also take longer than traditional, agent-brokered sales. This has to do not only with the research you put in but also the number of people you have to negotiate with. With FSBO sales, buyers feel less pressured than they would if they were going through an agented sale.
Instead of selling your land yourself, enlist the help of an experienced professional. Norman Campbell is a land sales expert, specializing in the Northwest Metro Atlanta area. His expertise lies in negotiating with developers to get the best return for landowners and understanding all potential steps and issues to navigate with land sales. Refer landowner inquiries to him and he will share his commission.
Still not convinced? Read more about why you should hire a land expert to sell your property. If you’re interested in getting a land valuation, you can request one here. For more information about Campbell’s work, send him a message via the contact form.