Turnkey Capital Group, based in Austin, TX, has been in the REI loan and REI lending business for many years. During that time, we have experienced what many new to the field may take awhile to see. Over and over, with land, we see this process from market to sold. It’ goes like this:
A seller puts their land on the market and they price it too high.
Then a buyer comes along and makes an offer, usually it’s too low.
The ‘just right’ price (that reflects the actual value of the land) is usually the selling price.
Now, sellers aren’t trying to gouge the market, it’s just that they don’t know better. Normal sellers often base the price of their land on a variety of things – could be their personal financial needs, or friends or neighbors that sold their land for x but they think their land is nicer so they’ll sell it for x + 1000, or they might ask a broker that is essentially guessing at the land value because he specializes in homes.
These reasons for arriving at their price have nothing to do with the actual value of the land, which is why it’s priced too high.
Then a buyer comes along without proper knowledge, and assumes a shoot from the hip approach and sends out a low ball offer. Which isn’t backed by information or knowhow either.
Yet, when you’re dealing with an investor who works day in and out with land, they have a different perspective on the value – as in they know how to accurately assess it. Investors are essentially land specialists who have the knowledge and knowhow to recognise a fair price. Also, investors don’t have the emotional ties to the property, and are able to offer a flexibility that most sellers are not.
In short, purchasing land from an investor is a smoother, simpler, faster, and more knowledgeable exchange.
Contact us today to chat about your land buying needs, we’re here to help.