Understanding Unsolicited Offers for Your Land

Like many landowners across the country, you may have noticed an increase in unsolicited offers for your land or letters from people claiming they want to buy it. How can you determine if these offers are legitimate, accurately reflect the market value of your property, or are simply a waste of time??

Let’s first examine who is sending these letters and why, and then we’ll go over some tips on how to respond.

WHY DID I GET A LETTER ABOUT MY LAND?

In Western North Carolina, the most common letters received by landowners I work with are from investors offering cash for land or promising a quick closing. Often, these unsolicited offers come with a contract and a purchase price that is far below the market value. Thousands of these letters go out every week and are typically sent from investors known as wholesalers.?

They blanket a large area with properties they know little about, hoping to discover one or two owners willing to sell for well below market value. Once a landowner responds, they will evaluate the property and make or revise their offer so they pay as little as possible and can immediately resell it for a sizable profit. They evaluate the resale potential by asking a local land broker to provide them with comparable sales and an estimate of the price they could get if they immediately resold it and wanted to sell quickly. If there is enough profit, they put the property under contract and have the land broker list it for sale.

Sometimes, wholesalers do this without ever buying the property. For example, they might find a seller willing to sell a lot for $50,000 and put it under contract. They then have a real estate agent list the property for $100,000. Once they have a second contract in place, they set up the closing with the current owner. The second buyer pays $100,000 for the property, the original landowner receives $50,000, and the wholesaler keeps the remaining funds after transaction costs.?

Other times, they will buy the property and then list it for sale as the new owner. Usually, they do not improve the property before they resell it, so the original owner could have likely sold the property directly and kept more of the proceeds.

The wholesaler usually has no intention of keeping the property and will never see it in person. Most live outside the area and must buy the property for less than its market value to make a profit, which is their goal.

WHAT SHOULD I DO ABOUT REAL ESTATE SOLICITORS?

However, some letters are worth responding to if you are open to selling your property. As licensed real estate agents, we occasionally send letters on behalf of buyer clients looking for specific types of properties in certain areas. These buyers usually want to own and use the property and are often willing to pay a fair price. Most of the time, they’ve already looked at everything currently available on the market and haven’t found that perfect property yet, so now they want to explore what might be available off the market.

So, how can you ensure you don’t leave money on the table if you are open to selling? The easiest thing is to call your local land broker from National Land Realty to help you understand the potential value of your land. They can provide you with some information to help you understand what your property would likely sell for if you worked with them to market it publicly.?

You can then decide if you want to accept the offer from the wholesaler or work with a land broker to sell your property.?

Although brokers charge a commission to market the property and represent you, you are more likely to net a higher amount from selling on the market than by responding to unsolicited offers.

If you’re interested in finding land for sale in Western North Carolina or want to talk with someone about your property, please get in touch with me at [email protected].

This article was originally written by NC Land Broker Patrick Snyder for the National Land Blog.