Archive for the ‘Selling Cheap Land’ Category

Advantages to Buying, Selling and Investing in Large Acreage

Buying, selling and investing in large acreage can be very exciting and rewarding. There are three inherent advantages to owning large tracts of land, as opposed to smaller lots.

  • First, there is almost an unlimited supply of small lots available for purchase, whilelarge tracts of land are a much rarer commodity.
  • Second, it is very difficult to subdivide a small lot, while large tracts usually can be parceled into smaller parcels, automatically increasing the per-acre price.
  • Third, in order for a small lot to increase in value, there has to be greater demand for usage, while large acreagecan increase in value simply as the result of ongoing and inevitable inflation.

In the year 1930, the Dow Jones was 294, and a person could have purchased large tracts of land all over the Western United States for $2 per acre. Today, the Dow Jones is approximately 11,000, representing a value 37 times higher than it was 80 years ago. Yet it would be very difficult today to find land for sale anywhere in the United States for less than $200 per acre, representing a value 100 times higher than it was 80 years ago.

There is another important factor at work here that should not be overlooked. The Dow Jones is a group of companies, but in 1930 there were many individual firms that failed, went bankrupt, or were liquidated and no longer exist. However, every single acre of land that existed in the United States of America in 1930 is still here today and is worth considerably more money.

In order for stocks to increase in value, there has to be ongoing positive performance and greater earnings. Large acreage, however, will gain value simply as the result of inflation and population increase, both of which are inevitable in future years.

According to the U. S. Bureau of Labor Statistics, it took $6,536 in 2010 to purchase the same goods and services that $500 purchased in 1930. That means inflation caused the dollar to lose 92% of its purchasing power over the last 80 years. The population of the United States in 1930 was 127 million people; today it is 317 million and is projected to exceed 400 million by 2040.

In the future, if inflation continues as it has since the founding of the nation; if the population continues to increase as it has since the founding of the nation; and if no one figures out how to make more land –then the only conclusion is that the finite supply of large acreage has to increase in value in future years!

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Steps to Selling Your Own Land

Selling your own land is not the traditional approach taken by most people. Usually, landowners simply contact real estate brokers and give them a listing. Many times, this approach is best, but in some circumstances there might be viable alternatives to consider, especially if 1,000 to 100,000 acres of remote, relatively cheap acreage is being sold.

In many situations, a real estate broker from a small town will be given the listing and charged with the responsibility of selling the land. No doubt this real estate broker will be very competent, but he or she might also be handicapped with certain limitations beyond his or her control.

Most small-town real estate brokers will handle a variety of listings consisting of different types of properties. Perhaps they will be trying to sell a couple homes, a ranch or two, a small trailer park, and maybe a commercial lot somewhere. In essence, they will be handling different products for different sellers and different buyers, and therefore, they might not be able to concentrate 100% on any one deal. Next, most small-town brokers don’t always have the large advertising and promotional expenses that are required in today’s marketing environment. Finally, they often advertise in only a small, local geographical area (weekly newspapers, the Multiple Listing Service, a few mailers, word of mouth, etc).

Selling your own land can be a complicated and time-consuming process that most landowners want to avoid.  So are there any alternatives a landowner can consider? Perhaps there might be.

Find a company that has a long and successful “track record” of marketing such properties to domestic and international buyers. A company with a large list of interested buyers, that specializes exclusively in large tracts of relatively low-priced land and can expose your property to a worldwide audience (consisting of many millions of people, instead of just a few local folks located within a 50-mile radius).

Then offer to sell this company an option to purchase your land, wherein the company will (ideally) resell the land for a profit under some formula wherein you receive not only your asking price, but also part of any profits generated. It becomes a “win-win” situation for you in the course of selling your own land!

To discuss the possibility of selling your own land, please click here.