Why Sellers Choose to Sell Their Land for Less Than Market Value 

One of the #1 questions we get asked by new members is why sellers would choose to sell their land for less than market value. 

In the investment world, it’s not uncommon for sellers to part with their land or house (or commercial building, or retirement home – you get my point) for less than its market value. The truth is that we get calls every single week from people we have bought land from thanking us for buying their land and helping them out, and this can be explained through a mix of psychological, financial, and situational factors. 

Immediate Financial Need or Tax Benefits: One of the primary reasons sellers opt for a quick sale is the urgent need for cash. Whether it’s to settle debts, pay for medical expenses, or address other pressing financial obligations, the immediate liquidity provided by a quick sale often outweighs the potential gains of a higher-priced, longer-term deal. Sometimes selling can also provide tax benefits to the seller. 

Problem Solving: The truth is that some properties need a little extra work to sell. They may have title issues or access issues. Most people and most real estate agents have no idea how to solve these problems, so properties end up accruing back taxes and sitting there for years until it is taken back by the county. In other cases people are paying the taxes but have no idea how to unload their lot. That’s where we come in – Land Academy members are armed with the knowledge to solve these problems, making it a win-win for us as the buyers and for the sellers. Solving these problems typically aren’t difficult, but they do require specialized knowledge. If you have that knowledge, there is plenty of profit to be made on these deals. 

Convenience and Speed: Selling land can be a lengthy and complex process involving negotiations, paperwork, and legal procedures. For many sellers, the convenience of a swift and straightforward transaction is more appealing than navigating the complexities of the real estate market. This desire for a hassle-free sale can lead them to accept lower offers. 

Emotional Decisions: Emotional factors can also play a significant role. Sellers might be dealing with inherited property they have no attachment to or want to quickly move on from a piece of land associated with negative memories. In such cases, the emotional relief of selling quickly and easily can outweigh the financial aspects. 

Avoidance of Future Complications: Sellers might be motivated by the desire to avoid future risks and complications, such as market fluctuations, tax liabilities, or maintenance costs. Selling the land for less than its market value can seem like a small price to pay for the certainty and freedom from future obligations. 

While selling land below market value may seem like a loss from an investment standpoint, for many sellers, the trade-offs in terms of financial immediacy, convenience, emotional relief, simplicity, and risk avoidance make it a worthwhile decision. We are doing our sellers a service, and in turn we profit from this service. We are always up-front about this – the people we buy from know that we are going to make a profit and wish us well.