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If you're thinking about selling your land, you may be wondering how to go about it. Selling your land is a complicated process, but it can have a huge impact on your life.
Before you can sell land to a developer, you need to determine its value. But how do you that you’re asking. It’s always best to speak with an expert in the industry, but in the meantime the following factors will help you determine the land's approximate worth:
The next step in selling land to a developer is setting the terms of the deal. This includes setting a price and terms of payment, as well as establishing a time frame for completion.
Setting a price: You'll want to set an asking price that's high enough so that you make good money on your property but low enough so that it doesn't scare away interested buyers or developers. The best way to determine this is by determine the residual value of the land, based on what could potentially be built on the property. If your land has some unique features or location advantages over other properties within its vicinity--such as being located near public transit--this can increase its value even further!
Setting terms of payment: Developers will typically pay a strong deposit, typically non-refundable around 10% of the purchase price directly to the seller once they are satisfied with their due diligence. In doing so, a developer will usually ask for some time to close on the property, so that they can proceed with the re-development process with the City. There is no once fit for all, so remember the negotiations are like a soft dance and everyone needs to be a little flexible when it comes to the overall deal.
Developers are people who buy land and build on it. They often have an idea of what kind of property they want to build, such as apartments or townhouses, and they're looking at which types of land are available in your area. If you want to sell your land to developers, you need to find a real estate agent who has a rolodex of contacts in the industry and can get in front of decision makers quickly, as well present your property in the best way possible to reduce the time wasted. One thing to remember is that developers get a lot of properties sent to them, so it’s how you position your land the right way that will sway the developer to select yours over the others.
Be careful about choosing a developer: there are some things that can make selling more difficult if not done right:
Before you enter in an agreement with a developer, it's important to understand their incentives and goals. Be sure to ask questions that will help you determine what they want in a property as well as how much they are willing to pay for it.
One of the most important steps in selling land to a developer is doing your own due diligence. Developers want to make sure they are not buying a lemon, so they are going to want some assurances that you or your representative have done some homework. Just because a property has a zoning on it, doesn’t necessarily mean it can have a particular product type built on it.
Developers need to know if there are any issues with approvals or entitlements (i.e., permits). They also want an idea of what can and cannot be built on the property, as well as how much it will cost them when they go through permitting process with local government agencies like planning departments and regional transportation authorities.
It may seem like a developer is asking to hold you up for months while they do their homework, but the truth of the matter is that all good consultants are extremely busy so getting in front of one or getting them to actually do the work on the review, takes a lot of time.
The first step in selling land to a developer is to do a lot of homework on the land through consultants, engineers, and the City. It also includes conducting a comparative market analysis (CMA) to determine what price you should ask for your property and whether there's residual land value on the site that could increase its overall value. Once all of these steps have been completed, it's time for negotiations between yourself and potential buyers! But be sure you have an expert on your side to avoid the many pitfalls along the way.
Selling your land is a complicated process, but it can have a huge impact on your life. The value of your property depends on several factors: zoning, negotiating with developers, doing due diligence and getting approvals and entitlements in place if you are selling it with readings in place.
Land values are determined by many factors including location, size of lot, view potential (if any), proximity to shopping centers or schools, how close services are, etc. Zoning laws also play an important role in determining whether you should sell your land or not as they determine what type of development can be done on that particular piece of land. For example if the area where you live is zoned residential then only homes will be allowed there, whereas if it was zoned commercial then buildings such as offices could be constructed. Depending on how much space is available for construction purposes, within the boundaries set out by local government agencies and governing planning policies, related directly towards real estate development projects within their respective jurisdictions throughout Canada's provinces/territories it may require getting your neighbors on board to make the development even feasible.
If you have land that you want to sell, it's important to know what developers are looking for. The best way to do this is by talking with one of our agents who can help guide you through the process of finding the right developer who will make an offer on your terms and timelines, and will help you avoid many of the legal pitfalls along the way.
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