Selling vacant land can involve these 4 hidden costs…
- Time
- Real estate agent commissions – 3-10% of the purchase price
- Surveys – $1,000-$10,000
- Closing costs – $600-$2,000+
Let’s breakdown each of these hidden costs…
1. Time
One of the biggest hidden costs in selling vacant land is your own time.
It takes time to…
- Figure out what price to sell your land for
- Take photos (or hire someone to take photos) of your land
- Vet and hire a real estate agent (more on that below)
- Negotiate with potential buyers
- Buyer’s due diligence time
Selling vacant land the traditional way – that is with a real estate agent, allowing buyer’s to work with their bank/lender – you can expect the fastest to receive your money is 60 days.
But, that’s the ‘fastest.’
‘Time is money, right?’
One way to lessen the amount of time for you to get paid is to price your land attractively to the market.
Think about this – if you were willing to sell your land for $100 wouldn’t everyone be calling you ready to buy it?
So, that’s the other part of the ‘time’ hidden cost. Getting the right asking price. Price too high and your land will be sitting on the market for months with no interest.
Read our tips on how to price your vacant land here.
2. Real Estate Agent Commissions
Another hidden cost to consider when selling vacant land is the real estate agent’s commission.
Some agents will charge up to 10% commission on the purchase price.
This commission has to do with the purchase price of the property.
It’s not worth a real estate agent’s time to sell $5,000 lots.
They have to get paid too.
Consider how hard the agent will work to market and sell your land.
Does their commission include them walking your property, hiring a photographer to take photos?
And…some agents are unfamiliar with vacant land sales in the area.
They may give you lofty estimates on what they think they can sell your land for in order to get your business.
But, then the property is priced to high and sitting on the market for months (see #1 above).
Read our reasons why not to hire a real estate agent to sell your vacant land.
You don’t need to hire a real estate agent to hire.
It’s perfectly legal to sell your piece of vacant land 100% on your own.
Read our 5 steps to sell land by owner here.
3. Surveys
Expect to spend $1,000 to $10,000 or even more on having a boundary survey for your property.
For larger tracts of vacant land – 10 acres or larger – surveys can cost $3,000, $5,000 or even $8,000+.
The cost of a boundary survey depends on these things…
- Size – the larger the property the more expensive the survey
- Complexity – a flat, square property is cheaper than a odd-shaped property in rough terrain
- Location – a property in the middle of nowhere without easy road access will cost more
- Surveyor’s availability – surveyors can charge more when everyone in town is busy
This means you can be paying thousands of dollars upfront to sell your vacant land even if you don’t sell it.
4. Closing Costs
The last hidden cost in selling vacant land is closing costs.
Closing costs are…
- Fees charged by title companies or real estate attorneys
- Taxes paid to properly record the property’s transfer of ownership
Closing costs can range from $600 to $2,000+ depending on the complexity of the transactions and the purchase price of the vacant land.
Sell Your Land With No Surprise Costs
Sell your vacant land to a ‘we buy land‘ company and eliminate the surprises.
Our network of professional land buyers are ready to make you a cash offer for your vacant land. You can sell your vacant land quickly and know the exact amount of cash you’ll receive.
Click here and tell us about the vacant land you want to sell.
Hidden Costs to Watch Out For When Selling Vacant Land
Selling vacant land can be more complex than it seems, and hidden costs often catch sellers off guard. Beyond the time, commissions, surveys, and closing costs highlighted above, there are additional considerations that can impact your bottom line. Let’s explore further strategies to minimize these costs while maximizing your return.
1. The Cost of Marketing and Advertising
If you’re selling your land on your own, you’ll likely need to invest in marketing to attract buyers:
- Photography and Videography: Professional photos or drone footage can cost anywhere from $150 to $500 but are often essential to showcase your property effectively.
- Online Listings Fees: Platforms like Zillow, LandWatch, or Craigslist may charge fees to list your property. Some niche land-selling websites also require subscriptions.
- Signage: For rural or roadside properties, a “For Sale” sign can cost $50 to $200, depending on the size and material.
Pro Tip: While marketing costs can add up, they’re often worth the investment to attract serious buyers and shorten the time on the market.
2. Legal and Tax Considerations
Selling land involves legal obligations that may come with added costs:
- Title Insurance: Ensuring the buyer receives a clear title can cost $500 to $1,500 but helps avoid legal disputes.
- Tax Liabilities: You may face capital gains taxes depending on how much the land has appreciated. Consider consulting a tax professional to explore options like 1031 exchanges to defer taxes.
- Disclosure Requirements: States like California have specific requirements for environmental and zoning disclosures, which could necessitate hiring professionals to provide accurate reports.
Pro Tip: Clarify all potential legal and tax obligations early in the process to avoid last-minute surprises.
3. Opportunity Costs
One often-overlooked hidden cost is the opportunity cost of holding onto land that could otherwise generate income or savings. For example:
- Property Taxes: Even if the land isn’t being used, you’re likely paying annual property taxes, which can add up over time.
- Maintenance Costs: Overgrown vegetation, fencing repairs, or trash removal can cost hundreds annually.
- Missed Investment Opportunities: The longer your land sits unsold, the longer your money is tied up and unavailable for other investments.
Pro Tip: Selling quickly, especially to a “we buy land” company, can help eliminate ongoing costs and free up your capital for other uses.
4. Environmental and Utility Assessments
Depending on your land’s location and intended use, buyers may request additional assessments:
- Soil Testing: Buyers interested in farming or building may require soil quality or percolation tests, which can cost $500 to $1,500.
- Utility Access: Confirming the availability of utilities like water, electricity, or sewer connections can require upfront fees.
- Environmental Impact Reports: In some regions, especially near wetlands or conservation areas, environmental studies may be needed, which can cost thousands.
Pro Tip: Selling to a professional land buyer eliminates the need to provide these costly assessments, as many will purchase land “as-is.”
5. Buyer Financing Delays
If your buyer relies on financing, additional hidden costs may arise:
- Extended Timeframes: Banks or lenders can take 30 to 90 days to approve loans, prolonging your timeline and increasing holding costs.
- Falling Through: Deals can fall apart if buyers fail to secure financing, leaving you to start the process over.
Pro Tip: Avoid financing delays by selling to a cash buyer, such as a “we buy land” company, for a guaranteed and expedited closing process.
How to Avoid These Hidden Costs
Working with a “we buy land” company can help eliminate many of these expenses:
- No Commissions or Fees: These companies often cover closing costs, title fees, and other transactional expenses.
- As-Is Sales: Forget about surveys, repairs, or marketing—your property will be purchased in its current condition.
- Fast Closings: Most transactions are completed within 10-14 days, avoiding holding costs and lengthy delays.
Why Choose SellTheLandNow.com?
Our network connects you with 12 professional land buyers who are ready to provide cash offers. You’ll know exactly how much you’ll receive upfront, with no hidden fees or surprises.
Frequently Asked Questions
Q: Can I avoid survey costs if I sell to a “we buy land” company?
A: Yes, most “we buy land” companies purchase properties as-is, eliminating the need for boundary surveys or additional assessments.
Q: How can I minimize my closing costs?
A: Selling to a professional land-buying company often removes the burden of closing costs, as many include these fees in their offers.
Q: Is it worth investing in professional photos or drone footage?
A: For traditional sales, quality visuals can attract more buyers and justify a higher asking price. However, selling to a “we buy land” company removes the need for marketing altogether.
Simplify Your Land Sale Today
Selling vacant land doesn’t have to involve unexpected expenses or lengthy delays. By understanding potential hidden costs and exploring options like professional land buyers, you can save time, money, and stress.
Ready to sell your land quickly and with no surprises? SellTheLandNow.com connects you with trusted buyers who handle all the details, ensuring a smooth and transparent process. Fill out our form today to receive your cash offer and eliminate hidden costs from your land sale!