We have a rule in our office: No commercial real estate or commercial broker is created equal. This could not be more true when dealing with commercial land investments. Not often the most glamorous sector among investors, land is a super solid investment class that can pay big over the long-term.
Since land is a sector that has many complexities, when you are ready to invest you will want to partner with a land broker that will not only be able to save you money during the negotiation, but make you money by investing smart. In land investment it’s not what you see that becomes a problem, it’s what you don’t. So below we outline what to look for in a land broker that will ensure a lucrative investment.
In his blog The Truth About Land Investing: 15 Warning Signs To Look For When Buying Vacant Land Seth Williams explains that while land investments can be simple and stable, they often come with unforeseen issues that arise much after the sale is finalized.
That is why being informed and knowing all pertinent information before you buy is so crucial. A quality land broker will guide his/her client through a very detailed due diligence process knowing what questions to ask, and solving problems before they become unsolvable. Saving future headaches and servings as an investors top defense against value loss.
15 Warning Signs to Look For When Buying Vacant Land
- What is the zoning of the property?
- What is the topography of the property?
- What is the annual tax obligation?
- What public utilities are available?
- What are the required setbacks?
- Does the property have any usage restrictions?
- Is the property located in a flood zone?
- Does the soil percolate or have access to a nearby sewer system?
- Is the property landlocked? Are there any easements or access roads to the property?
- What is the size and shape of the parcel?
- Does the property have access to a municipal water supply?
- Is there a moratorium on bulding?
- What about junk, tires, rubble, gas, oil and other containmenents on the property?
- What were the previous uses of the property?
- What do the surrounding proeprties look like?
To delve into the 3 most important out of this list see our recent blog post, Buying Land in Baton Rouge, Ask Yourself These 3 Questions.
Ok so we know a quality land broker will expertly guide a client through the due diligence process, check. What happens when during that period the lipstick starts to wear off that pig? Once you discover that first zany usage restriction that makes you go “Really?!” you will need a land broker who can do the projections and give you the thumbs up or down.
A quality land broker has your best interests in mind and will be able to advise you on all steps of the purchasing process whether you should adjust your offer, or leave the deal table for good.
Having skills in research and negotiation are necessary for a quality land broker, but they don’t mean anything unless they are used. When looking for a land broker make sure to choose one that has not only been in the commercial market for many years, but also has at least a handful of transactions under their belt.
Our Advisors have helped many clients navigate land transactions across Baton Rouge and surrounding areas. They are versed on local ordinances and issues affecting the sale and purchase of land assets and can help ensure a successful, and lucrative, investment. Contact one of them today with any questions you may have.