SELLING LAND TO A DEVELOPER
When is it worth selling to a property developer?
Whether a farmer, an heir, or selling for reasons of age, anyone who wants to sell a property is faced with the question of how and to whom to sell. Selling privately via an estate agent is not your only choice. A reputable property developer as a buyer is also a very lucrative option. For whom this is particularly worthwhile and what you should always pay attention to when selling a property, you will find out in this article…
How and where do I find the right buyer for my property?
Traditionally, many property owners look for a buyer for their property through an estate agent. Others try their luck at selling by themselves in order to save on the expensive estate agent’s commission, through private advertisements on real estate sales platforms on the internet,for example. Another option is to sell to a professional property developer. What are the advantages and disadvantages of these options?
Option 1: Selling the property to a reputable property developer
Selling directly to a property developer is a lucrative alternative for selling land because you can achieve higher prices than when selling to private individuals. However not all property developers are the same. Moreover, property developers often specialise in certain properties. The following advantages therefore do not always apply to all property developers in the market.
- better sales prices possible (in the case of Via-Intelli usually significantly above standard ground value)
- professional property developers can assess the development possibilities of a plot better than private individuals
- good reinvestment possibilities (thus tax savings possible)
- No long waiting times due to fast processing
- the property is made more valuable
- expert advice on disposals & re-purchases
- better sales prospects for particularly large plots on which more than one residential unit can be built
- better chances of selling difficult plots (e.g. narrow or scarce space, sloping site, previous demolition)
- caution: not all property developers are reputable!
Our tip: Get detailed advice and ask lots of questions. Ask for references. Research how long the developer has been on the market and what kind of structure they have. How do they behave during consultations and agreements? Then listen to your gut feeling!
Option 2: The sale of a building plot via an estate agent
- relatively little effort on your part, as the estate agent conducts the viewings with prospective buyers
- a quicker conclusion than with a private sale
- escort through the sales process incl. notary public
- estate agents are primarily interested in properties that are easy to sell
- the valuation of the property may not be correct
- sometimes very high commissions
- self-interest when it comes to selecting interested parties. Under certain circumstances, interested parties are preferred who promise the estate agent follow-up orders
If the brokerage is not successful, no commission is due. However, other agreed expenses may be charged. Pay attention to the details in the brokerage contract! Attention: The estate agent is also the contractual partner of the buyer.
Option 3: The private sale of a building plot via advertisements
If you don’t want to pay an estate agent’s commission and don’t mind the expense, you can do it yourself by means of advertisements on the internet or in the newspaper.
- no broker’s commission
- individual selection of the buyer
- large expense for advertising & marketing
- challenge to set a realistic selling price
- newspaper ads expensive & less successful
- possibly many exposé collectors, no serious interested parties
What is my property worth? The first question and certainly one of the biggest challenges when selling a property privately. The most important factor for the sale is what price can be achieved for a plot of land. If the price is set too high, the sale will be difficult, but no one wants to sell too cheaply either. The achievable land price depends not only on the location and size of the land, but also on the development possibilities. It is possible that development regulations have a negative impact on the development possibilities.