Prices can be unrealistic
If you’ve spent any time shopping for rural land, you’ve probably learned that prices for the same kind of land are “all over the board.” The truth is, it’s not unusual for land sellers to have an unrealistic price. So, it is important to independently test the asking price and have some facts in order to make a good decision.
Testing asking price is important
So, how can you know what a fair price is? The key is to study actual sale data. Then, get an appraisal, retain a real estate professional, or go to the courthouse yourself. Otherwise, your estimate of fair value will be shaped by coffee shop talk or what an owner asks for their land – all are poor guides for fair pricing. Sale data is available at the county probate office if you know how to search.
Be sure to compare oranges with oranges
Be sure the sale data of property that is similar to the property you are looking at (similar size, location, timber value, access, land quality & use). If the property is listed with an agent, they should be able to provide you with comp sale data, but some agents and most landowners don’t look at this data before setting an asking price.
Many people use borrowed money to purchase rural land. If…