With the real estate market as hot as it’s been recently, many landowners are looking at their portfolios and wondering if anything needs to go. Whether it’s farmland you grew up on, land you didn’t expect to inherit or an investment you made in the past, there are a few things you’ll need to know as you get ready to make a sale. Here’s a list to keep you moving smoothly through the process.
● Confirm what you own
While most landowners are present and understand the details of what they own, much of the farmland sold today involves absentee landowners. Knowing the farm’s acreage, precise location, and improvements, such as tile, bins, and pivots, can smooth your selling process. Existing leases and title issues can impact your ability to sell your property, so having those addressed or worked through ahead of time is a good plan.
An attorney or tax accountant can give you good counsel about whether there will be any tax implications for selling the property you are considering.
● Establish your selling goals
Having a clear set of expectations for your farmland sale is vital. Is there a specific price point you need to reach or a timeline you’d like to stay within? Knowing these goals can help you and your sales partners make the right decisions throughout the process.
● Collect as much data as you can
For buyers looking to purchase farmland, the data from the field can make the sale. Information such as previous yield data, fertility history, soil types, tile maps or water usage records are essential tools that can encourage buyers to spend more on the property.
● Understand current values for comparable land
Knowing what land is selling for near your farm can help you set goals for your sale. An experienced sales partner can help you use all the information you have, alongside their knowledge, to make those assessments.
● Choose the correct sale method for you
Many sellers can choose between an auction or sale through a brokerage. This decision goes back to knowing your goals. An auction may be better if you are working on a specific timeline. If your timing is less stringent, a brokerage may be an option. Also, many auction groups have dedicated lists of investors interested in the type of land you are selling.
So what should you be looking for as you consider what brokerage or auction company is right for you?
Experience is a great place to start. While prices and markets may change, firms that have been around for a long time have probably seen it all–they know what you need and where there are watch-outs. More experienced firms often have a long list of connections, investors and other relationships they can leverage to help you find the right buyer.
Today, attracting the best buyers takes more than just one approach. Make sure the firm you choose has a marketing system that works. Look for a firm that knows how to define your target markets and create a multi-faceted approach that draws the broadest range of potential buyers.
Because there are many ways to purchase land today, use a firm with experience in various methods. A brokerage may meet your needs, but an ideal partner will be able to walk you through the pros and cons of opportunities such as a multi-parcel auction, an online auction, a bidders choice or a sealed bid.
Know if you’ll be paying for marketing, if there’s a commission, etc., and consider that in your selling goals. Also, see how the fee structure works, as different firms use different methods. In some cases, sellers pay any fees associated with the sale, and in some, a buyer’s premium covers those costs.
The most important thing is to choose a partner that’s right for you.
Let Murray Wise Associates Help You
For the past 25 years, Murray Wise Associates has completed land transactions totaling more than $5 billion in 43 states. MWA is committed to helping you achieve the highest return on your land investment. We can connect you with the people looking to buy property just like yours, so let our expertise work for you.