Selling Land: The Pricing Process

By
Real Estate Broker/Owner with 406-270-3667, kat@thehousekat.com, Broker, eXp Realty RRE-BRO-LIC-75443

One of the first things a seller will want to know when considering putting land on the market is the answer to the question, "What can I get for my land?" In Montana, sale prices are not publicly disclosed, so it's hard to figure out what buyers are paying for properties without contacting a real estate professional.

 

So now you've contacted one, and have asked the question, "What can I get for my land?" The answer is NOT to use an average per acreage price and multiply times the number of acres you have. No, instead the following are some of the attributes that should go into calculating your land's value.

 

First, the agent must physically visit your property. Each land parcel is so unique that even basing a price on an adjoining property can be problematic. The only way to know exactly what attributes are important is through an agent visit. And NOT a drive-by. The agent must step foot on the land to determine the following:

 

Property Boundaries:

Are the boundaries all marked? A follow-up question will be whether the property has been recently surveyed. Knowing exactly where the edges of the property are is very important when questions of home, outbuilding or fence locations arise.

 

Views: 

Are there any views (of mountains, lakes, rivers, valleys)? If yes, where are they visible? Do trees have to be removed in order to see or enhance views, and if yes, where are those trees?

 

Building Sites:

Are there any sites already available and ready for a building? Are there areas that are flat but not yet prepared? What might be required in order to make the land build-able?

 

Utilities: 

Some of the key requirements for building a home have to do with utilities. Is electric already on or near the property? If it's not, where is the closest access point? This might not be easily visible, so a follow-up call might be required to the electric company. Is there a well in sight? What about a septic system? And cell service? Is it possible to make a call from the property? And is wireless service available all over the property or just in certain locations? Can you set up a hot spot with the cell service? Location of internet may be one factor in determining where to build. Selling Land: The Pricing Process photo of creek

 

Natural Water: 

Is there waterfront, and if yes, how many feet? Is there a creek, river, lake or any other body of water on the property? Does the river or creek flow year round? Water is a very valuable resource in the area, and can add to the price if it is located on the property.

 

Sun:

Are there southern exposures? If yes, where? Do trees need to be removed in order to best utilize the sun's rays? Often buyers will want to plant vegetable or flower gardens so this is another factor in determining the value of the land.

 

Access:

What is physical access to the property like? Is the road paved, gravel or dirt? Is it maintained and if yes, by who? Who is responsible to fill in ruts or get rid of trees that fall across the road? Is there already a driveway in place? A parcel of land on a paved county road that is maintained by the county highway department may be more valuable than a similar parcel of land on a rutted, dirt, non-maintained road.

 

Acreage: 

Is all of the land usable? Are there steep hills? Are there wet or swampy areas? Are there areas of erosion? A 20 acre parcel with only a few acres of usable land will be less valuable than the same size parcel with full availability of use.

 

Other: 

Are there any areas with garbage or debris piled up? Where might a driveway be installed and how long might it be? Are there a lot of dead trees that need to be cleaned up? Are there any special trees that would be desirable (apple trees, other fruit trees)? Are there signs of wildlife? What about noxious weeds?  

 

Non-Observable Factors

The more items that can be visually observed by the agent the more accurate the price range. But it's not only the visual aspects that will go into determining the price. Other attributes that may impact price could include:

 

Covenants and Zoning:

Some buyers want covenants, some don't. Some zoning districts can be constrictive, while others are not. The agent should determine how restrictive usage of the land is, in order to better assess buyer demand (and accordingly price).

 

Legal Access: 

While physical access can be visually assessed, legal access needs further review, prior to listing the property. There are online tools in the Kalispell area that provide agents with insight into whether those back gravel roads may have easements. Roads without legal access make the purchasing process much more problematic and decrease the value of land. In some cases, lack of legal access could result in land owners needing to resolve the issues prior to putting on the market. If buyers cannot get to the land, use a land loan to purchase or get title insurance that covers access issues, they won't buy it.  

 

Summary

If you are interested in selling your land, call a real estate professional who is experienced with land sales. If you call one who tells you that the average price per acre in the area is $xx, so let's just multiply that by your acreage to come up with a sales price, move on. If you're in the Kalispell area, call me, Kat, on 406-270-3667 or email me at kat@thehousekat.com. I'll throw on my boots, and head on out to your property.

 

Until then, for more information on the Kalispell land market, click here to read previous market reports and here to read about Kalispell.

 

Originally published at thehousekat.com.

Posted by

 

Kat Palmiotti, The House Kat

Licensed Broker, CBR®

 

eXp Realty LLC

P.O. Box 10458

Kalispell, MT 59904

 

email: kat@thehousekat.com

www.thehousekat.com

 

406-270-3667 (MT)

 

facebook    Kat's Homes

 

 

Comments (42)

Will Hamm
Hamm Homes - Aurora, CO
"Where There's a Will, There's a Way!"

Hello Kat and great information on selling land, We have three lots to sell for single family homes that are not selling yet.

 

May 04, 2021 08:16 AM
Rocky Dickerson
Realty One Group - Las Vegas, NV
Superior Service!

Good morning Kat Palmiotti great post with some important informations for land owners

May 04, 2021 08:37 AM
Eileen Burns
Trans State Commercial RE Ft. Lauderdale/Miami/Palm Beach - Fort Lauderdale, FL
FL Probate Agent, Hotel & Land Specialist

Awesome article Kat Palmiotti Congrats on the feature.  Am also wondering how long it takes to sink a well and how many you would need on a large parcel?  What about septic systems and time of year for installation?  Are there several vendors to choose from?  How about clearing the land and time involved?  😎

May 04, 2021 10:19 AM
Andrea Bedard
Thompson Company, REALTORS® 240.593.2860 - Silver Spring, MD
Fluent in German and Real Estate * M.A. ABR ASP

I learned so much from reading your post Kat! While some of the criteria were obvious to me - even though I don't list/sell land/lots - others I wouldn't have though of, such as the sun exposure, noxious weeds, and cell service! 

Anyone looking for land, or having land to sell in Kalispell would be wise to contact you. 

May 04, 2021 07:26 PM
Lynn B. Friedman CRS Atlanta, GA 404-939-2727
Atlanta Homes ODAT Realty - Love our Great City - Love our Clients! Buckhead - Midtown - Westside - Atlanta, GA
Concierge Service for Our Atlanta Sellers & Buyers

Kat Palmiotti 
Another thorough, professional explanation about your Market. Thanks - so different from my urban area - fun to learn!
All the best - Lynn

May 04, 2021 10:42 PM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

Indeed, Brian England - without calling a pro, how else would anyone know what people are paying? 

 

Land is my favorite too Paula McDonald, Ph.D. ! Enjoy your day.

May 05, 2021 05:38 AM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

Will Hamm - good luck with the lot sales!

 

Thank you Rocky Dickerson ! Enjoy your day.

May 05, 2021 05:39 AM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

Eileen Burns - All excellent questions that are going to have to be addressed in another post!

 

Thank you so much Andrea Bedard - it's amazing how many people have to have cell service on their property. I had to have it also, so I totally get it, but there don't seem to be any people who want to rely on copper wires. :-)

May 05, 2021 05:42 AM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

Thank you Lynn B. Friedman CRS Atlanta, GA 404-939-2727 for reading this post and commenting. I appreciate you.

May 05, 2021 05:43 AM
Erik Hiss
Keller Williams Capital Partners Realty - Worthington, OH
You can trust me for all your real estate needs!

All good aspects for selling land...but also real estate in general. I can't believe prices are not disclosed in your state...that's hard to wrap my mind around! On one hand it would be great, but then on the other it could be difficult. Thanks for the info!

May 05, 2021 05:45 AM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

Also a thank you to whichever feature fairy featured this!

May 05, 2021 05:51 AM
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg Real Estate

Really good summary on what takes to evaluate land. The guy that won't get out of his car is not necessarily the best man for the job. Glad they have you in Kalispell.

May 05, 2021 06:43 AM
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

Good Wednesday morning, Kat.

Take care, be safe and have a great day.

May 05, 2021 06:49 AM
Sharon Tara
Sharon Tara Transformations - Portsmouth, NH
New Hampshire Home Stager

Wow...so much information. I'm sure people with questions about selling their land will be very happy to find this post!

May 05, 2021 12:41 PM
Shannon Jones
The Shannon Jones Team - Long Beach, CA
Long Beach CA Real Estate

Very interesting information! Thank you for sharing!

May 05, 2021 03:18 PM
Katina Hargrove 352-551-0308
Stake Your Land Realty, Inc. - Eustis, FL
Broker/Owner, GRI,SFR, REALTOR®

Good morning Kat,

You posted some great key points. 

Thank you for sharing.

Katina Hargrove

May 06, 2021 06:26 AM
Wanda Kubat-Nerdin - Wanda Can!
Red Rock Real Estate - St. George, UT
So Utah Residential, Referral & Relocation REALTOR

When selling land, an agent must be well versed on the process or many things can and do go wrong otherwise. Thanks for your experise on the subject Kat Palmiotti!

May 06, 2021 07:41 AM
Wanda Kubat-Nerdin - Wanda Can!

And congrats on the feature as well!

May 06, 2021 07:43 AM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

Erik Hiss - In my market reports I have to generalize prices when I'm talking about what a specific home sold for!

 

Thank you Lyn Sims - there are definitely some who don't get out of the car.

 

Roy Kelley - I wish you the same!

May 06, 2021 08:48 AM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

Thank you Sharon Tara - I hope so!

 

Shannon Jones - Thank you!

 

Katina Hargrove 352-551-0308 - Thank you for reading and commenting!

 

May 06, 2021 08:49 AM
Mark Don McInnes, Sandpoint
Sandpoint Realty LLC - Sandpoint, ID
North Idaho Real Estate - 208-255.6227

Top of the morning Kat,  Absolutely on spot here.   Pricing land, as with homes, not a simple A X B = C.   Many factors to consider.  Informative post.  Mark

May 06, 2021 09:02 AM

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