Welcome to the John Hall and Company Selling Land in Alabama series. Today, we answer the question, “What Does It Cost To Sell Land in Alabama?”
The first conversation with a new client involves outlining the costs associated with buying or selling property. It is very important to understand costs. Please, note that expenses will vary among real estate transactions.
Up Front Costs
Sellers are responsible for certain closing costs along with the real estate commission to the listing broker. However, there are other up-front costs that may be required to make the property suitable to sell. The agent should do an assessment on the property and suggest to the seller what to do to get the best return on their investment.
These costs may not always be necessary, but they can greatly improve profits. For instance, the property owners will definitely want to make changes to improve the aesthetic appeal for prospecting buyers.
Key Investments for Selling
One key investment is having a good road system on the property. A good internal road system will appeal to a future owner. In addition, the right road gives curb appeal and accessibility during showings. The cost of an internal road system is dependent upon the condition of the existing road and the size of the tract.
Other important costs are incurred with maintenance expenses such as mowing, land clearing, spraying, planting, etc. These costs are a relatively minor part of the transaction but can go a long way in getting the property sold quickly for the asking price.
A land survey is an additional cost that sellers should seriously consider. Surveys are not required, but they are a great asset in selling a piece of property. Buyers will want to have a clear understanding of exact acreage and boundary lines before moving forward with a purchase. A survey gives the buyer assurance of no underlying issues such as encroachments or any kind of boundary line disputes. Costs of surveys vary depending on the size and shape of the property. It is best to consult with your listing broker to determine if doing a survey is justifiable before putting a piece of land on the market.
After an agreed-upon sales price, costs will then be settled at closing. The majority of fees are negotiable as to who pays between buyer and seller. However, there are standard fees assigned to each party. Sellers often account for costs such as agent’s commission, deed preparation, prorated taxes, attorney fees, and any judgments or liens tied with the property. The agent’s commission is an agreed-upon percentage of the sales price between agent and seller.
In closing, all land sales transactions are unique in their own way. This article gives sellers a good outline of standard costs. These factors emphasize the need to consult with a qualified broker. Selling a piece of property can seem like a big task, but having an experienced land agent to guide the process is critical in obtaining the desired profit.