Land For Sale, Inc., I SELL DIRT NOT PROMISES

Broker Promises: Why did my neighbor's land deal fall apart?

You see Fred at the coffee shop and he's all excited because he "sold" his land for so much money. It was emotionally a very hard decision to make, but once Fred and Mable signed the purchase agreement they were ready to move. Fred was bragging how this developer paid more than the others that looked at his land. And, unlike the others who wanted their deposit held in some escrow account, that nice developer wrote the check right to Fred and Mable so they used to for the non-refundable deposit on their new townhouse.

The next time you see Fred he's not looking so happy. The developer changed his mind, said the price was too high, and now he wants his deposit back. The money Fred and Mable had already spent on their new townhouse!

So where did Fred go wrong?

He went with the wrong Buyer. Most land buyers are honest hard working people like you. Like in anything, there are a few bad apples. You have to bite into a lot of apples until you learn to smell the bad ones. Land For Sale, Inc. knows how to sniff out bad apples so your deal doesn't go rotten. "I Sell Dirt, Not Promises".
The price was too high. Fred had a bad feeling in his gut when the one price was so much higher than the others, but he ignored it, dreaming of his fancy new townhouse, his truck, the vacations he and Mable would take. If your Buyer is using his own cash than he didn't accumulate that much money from paying too much for land. And if he has to borrow the money and the price he offered you is higher than what your other neighbors got, the land won't appraise and the bank won't lend him the money.

Also note that the real estate market for 2006 is vastly different than the booming market of the last 10 years. Some developers did get caught up in the excitement and paid too much for land. Now they are losing money and can't buy your land now. Also, the banks have noticed this and many are pulling back their real estate financing. All of this affects how much money you can get for your land today.
Throw the spaghetti at the wall and see what sticks. Some land buyers have that attitude. They will "tie up" a lot of different properties with a purchase or option agreement and pick the one that looks like the best opportunity for them.
The Buyer didn't have the right experience. Ned Newguy signs a purchase agreement with Sam Seller for his lakefront property contingent upon the city approving the land for development. Ned agrees with the city to deed all of the lakeshore to them for a walking path. A more experienced developer may have handled it differently. Then Ned realizes that he will no longer have lake lots with dock rights to sell and he can't get premium prices for them. So Ned walks away. Not only did Sam not close his deal with Ned and mess up Sam's life plans, Ned messed up the development potential of Sam's land because now the City feels entitled to that lakeshore so Sam's land is worth less to the next guy.
The Buyer didn't do their homework. Goes with the spaghetti approach. They get it tied up first, then do their research to see if the deal makes sense for them. Land For Sale, Inc. has a different approach: avoid surprises. Do research first and lay it all out on the table so the Buyer can make an informed decision and walk to the closing table with you instead of walking away. Though there is some research that can't be done without a contract with you: survey, soil tests, wetland delineation. Legitimate problems can crop up in these issues that sometimes can't be solved. Land For Sale, Inc. has the knowledge and experience to resolve a lot of them.
The Broker didn't have the right training. Realtors are taught how to sell houses, not land.
Your neighbor lied about his price. Lloyd might have lied about the price he sold his land for. Unlike Fred and Sam, Lloyd's deal really did close. However, Lloyd told everyone that his land sold for more than it actually did. Closed land sales are public information-just go down to your County Assessor's office and you can see the record of your neighbor's sale. Then you need to compare apples to apples, and know how much of the land was usable and other factors your assessor can explain to you.

Should I leave my land to my kids? Х What about taxes? Х Broken Promises.
Appraisal Services Х Who is Land For Sale, Inc.? Х Here's the Dirt

Land For Sale, Inc. Х 763-420-4757
P.O. Box 2316 Х Maple Grove, MN 55311
Laurie E. Karnes, Broker/Owner
landforsale@visi.com