Times are good, and Northwest Arkansas is hot. Everybody is jumping into real estate — again — and it’s up to the Realtors to educate owners how to best get their property sold.
Many times I come across people who are frustrated with their agents because their property hasn’t sold, but here are some questions to consider: Are you asking the Realtor to market it as commercial property when it is not zoned commercial, and do you want a commercial listing price when the property isn’t zoned commercial, plus has an old house and storage buildings on the property?
There is a certain formula commercial developers must use in order to make land viable for development, and their analysis consists of most of these following items: Cost of land purchase, time and money to rezone, loan costs, cost of demolishing structures, cost of dirt preparation for building, cost of building new structure and whether to occupy or lease the property.
What marketable rent can they expect after such costs are incurred? Is it zoned to sell? Are utilities available at the site? Is the land level?
I’ve come across land listings that are priced high-five figures per acre that are “close to schools” — OK, three miles away, on a side road with no sewer. Some developers can work with that, most cannot. Time equals money. If it is priced to sell, it will sell, but every owner likes to be told they’ll get their desired asking price.
When nothing happens, either the price has to be dropped dramatically and seller and agent are at odds, or the agent may just disappear, never to be heard from because of embarrassment that nothing happened.
If a Realtor has given you comparable prices of similar properties that have sold and are currently on the market, these comparisons are one’s expected range of potential sales price. Keep in mind, though, we are Realtors, not appraisers. It is best for owners to have the property surveyed, appraised and possibly have it zoned for intended use.
Does this cost money? You bet. But if you’re serious in getting your property sold, you need to do some legwork and your Realtor can help you. I’ve come across owners who say they aren’t going to just give the property away. You’re not giving it away if you get an appraisal to help you realistically price your property. If the property sells within six months, sometimes a buyer’s lender may be able to use that appraisal for loan purposes, so it can be worth it. Having your property surveyed tells you exactly what you have and possibly for an additional charge, the buyer can have the survey made in their name after closing. Again, this helps you and the buyer.
Realtors have a large network of resources. We can provide suggestions of surveyors, engineers, city officials, lenders, appraisers, property inspectors, title companies and others. We do and are capable of more than just putting a sign on the property and waiting for a call.
Real estate agents have to have some legal sense in preparing contracts and all the related addendum. We also have to be psychologists of sorts to sometimes deal with sentimental attachments the owners have to the property, or the price they think it’s worth. We have to be marketing specialists in order to make sure the property is well represented in our networking systems and why it compares more favorably than other similar properties. We wear many hats in order to facilitate a deal.
If your property has been on the market for more than a year in the Northwest Arkansas area, ask yourself these questions, see what you and your Realtor can do to make it more viable for sale and get it sold.
Editor’s note: Jacklyn Perry is a CCIM and executive broker of commercial real estate firm Simplicity Real Estate Solutions in Fayetteville. The opinions expressed are those of the author.