How To Sell A Residential Lot?
I am getting ready to purchase some lots. I’m pretty confident that I can sell these lots for 30-40% more than the purchase price. Taxes are current and there are no liens. As a dry run I am going to purchase one lot and sell it. This is my first real estate transaction (a learning experience where I am really more concerned with the process more than the profit). Once I get a buyer how do I transfer the deed (sell it)? What department of the city handles this? What paperwork must I file? Is this a relatively simple process? Does it usually cost much? Can anyone recommend a book or website?
I am going to take a side approach to your answer. You may want to consider partnering with a builder. With a good partnership you can make much more money than selling lots individually.
Transferring title on a building lot is done essentially the same way as transferring title to a lot that has a house on it. Your buyer gets title insurance, finances or doesn't finance the purchase, the title company prepares the deed from you (grantor) to the buyer (grantee) and has it recorded at the county courthouse. If your state is similar to PA, transferring title to a vacant lot will be subject to the same types of closing costs as for a lot with a house--transfer tax, real estate tax prorations, etc.
You didn't ask anything about your buying the lot, so I don't know if you've already done your due diligence on the property and had your real estate attorney prepare the purchase contract.
I'm getting the lots from the city. They are city inventory.
Dre, always good to see another investor from Detroit. I wish you the best of luck, but how do you plan on selling lots (at least most that I've seen in our fair city) at 30-40% above the market value? Just a question...
p.s.Feel free to contact me if you ever get interested in wholesaling properties.
Good luck-
Patrick
The obvious issue with experimenting on one lot is that you're not the only one who gets to view the results of the experiment. You might consider doing something to tie up the others as well.
Well I've watched a guy on eBay in the past month sell about 10-20 city lots all above a certain price point. I can get my lots for 30-40% less. I know for a fact that all these lots are in crappy spots randomly located because I'm a city dweller. I can get alot better lots than this seller. Each lot gets 20-30 bids. The fact is that at the moment there is a market on eBay and people are consistently paying for these lots. I don’t know if they don’t know what they are buying or just bidding because they see relatively cheap land but I would like some of this profit in my pocket.