Land is very valuable, especially in hot areas. When certain factors are taken into account, selling land in Texas may be a lucrative opportunity.
With a high demand for housing in Houston, builders are always on the lookout for available land. For whatever reason, you may find yourself with a large garden that you cannot maintain or with more square footage than is necessary. To that end, you may think about selling off a portion of it. If you have a mortgage, you might use the money to pay down a portion of it or put it toward other investments.
Nonetheless, it would help if you thought about the long-term and immediate consequences of selling part of your Texas property.
Can You Sell Part Of Your Property?
Is It Legal?
Can you sell part of your property? Yes. It all starts with the question of zoning regulations. The buyer and seller should do preliminary research to learn the minimum lot size needed for a particular property.
If the proposed sale reduces the lot size below the legally required bare minimum, the transaction cannot proceed.
Selling A Portion Of Land With A Mortgage
The seller cannot finalize a purchase agreement without the consent of the deed holder, who is often the mortgage lending institution. Your mortgage lender must permit you to sell off a property section by obtaining a partial release of the mortgage.
Can you sell the land you still owe on? If you try to sell a property you don’t own outright, your lender has the right to take drastic action, such as canceling your mortgage or even the sales transaction. Contacting a local real estate attorney will help you understand your rights and obligations if you wish to sell your vacant land while still paying your remaining mortgage. The attorney will examine your legal documents and advise you step-by-step to ensure the transaction goes through without a hitch.
Can you subdivide land with a lien on it? Your property is now legally encumbered by the lender’s lien. Without the lender’s consent, you cannot sell, trade, or transfer any interest in the property.
How To Sell Part Of Your Property
Determine If You Can
Determine first whether your property is made up of more than one lot. The seller may include more than one lot or piece of land in a single real estate transaction.
Can you divide the land with a mortgage? If the property parcel you want to sell is already subdivided into individual lots, selling it will be a more straightforward process. If it isn’t, you may need to subdivide the portion of land you want to sell. If that’s the case and you’re also subdividing property with a mortgage, there will be more red tape to wade through and more costs associated with the whole process.
Decide On How To Subdivide The Land
Property subdivision splits a larger tract of land into smaller parcels. Creating new parcels of land is governed by ordinances in most jurisdictions. To know what laws apply to your circumstance, you should go to your area’s planning, zoning, or development office.
Get A Survey
Get a professional land surveyor or engineer to measure the land and create a detailed blueprint of the area. A property’s plot is a map detailing the property’s boundaries, as well as any public right-of-ways and easements that may exist on the land.
Prepare The Land
In the real estate business, first impressions are sometimes the only ones that matter. In the same way you wouldn’t show a filthy home in an open house; you should clean up your lot before allowing prospective buyers to view it.
Make sure your property is well-maintained by keeping the grass mowed, getting rid of any garbage, and taking any promotional images you need. Some sellers may even grow bluebonnets on their empty lots to attract potential buyers.
Determine A Price
Overestimating the value of your property or lot can be a colossal error you come to regret deeply. In addition to deterring potential buyers from ever making an offer, setting an unrealistically high price for your home can lengthen the time it takes to sell.
Unlike houses, land is more difficult to put a price on. Market value for developed lots in communities may be obvious, given the previous sales of comparable lots. However, it may be more difficult to find “similar” transactions of raw land to serve as a basis for setting a price.
Furthermore, the final price you might garner for a single lot or undeveloped land can vary substantially based on the buyer’s planned use of the property. For instance, if a potential buyer sees your land as suitable for a luxury housing complex, they will be willing to pay more per acre than someone who plans to construct a single house there.
When setting a price, it’s essential to think about what you require and how that price can affect sales. You may have to decide between earning the best price and selling the property as soon as possible. As an added consideration, if you have to sell for financial reasons, it might affect your chosen price.
Understanding the land market as a whole, why people are buying vacant land in that location, and who these land buyers are is essential to setting a fair price for your property. Hiring a seasoned real estate agent specializing in land transactions may be quite beneficial.
Find A Buyer
Putting your land up for sale is a good option if you’re looking to sell a piece of it to a real estate investor who is ready with a cash offer. Time is money, and this may help you save both. Selling to an investor saves you the trouble of finding and interviewing potential real estate agents and developing promotional materials.
Real estate investors like Assemble Houston buy land and houses fast and often have extensive expertise and understanding in the field. They can help you figure out how to divide up your property legally. Most land sales may be completed within two weeks, making it the quickest option.
Read here if you’re thinking about selling your land privately.
Should You Sell Part Of Your Land?
What Will It Do To Home Value?
Apart from the apparent decrease in value due to lot size, the value of your home may go up or down depending on what is developed in the vicinity. Even if you have zero plans to build on your property, you should still be compensated for the value it offers. To determine the highest and best usage value of the piece of property you want to sell, you need to consult with an appraiser who is versed in appraising subdivided properties.
The fair market value of a piece of property may also be determined using input from real estate agents. Doing so might help the seller see things from several perspectives. The seller should also think about the value of employing a local real estate attorney for assistance in negotiating a reasonable arrangement. If the property owners are well-informed and thoroughly understand their rights, risks, and duties, as well as the mortgage lender and title company, then everyone wins.
How Will You Feel About Neighbors?
Quiet and beautiful surroundings are a major perk of owning property. When you have neighbors, you may have to put up with things you don’t enjoy, like noise or different lifestyles.
In most cases, the homeowner next door is not someone you should approach about buying your house, but if you’re trying to unload a piece of land or a vacant lot, they may be one of your greatest prospects.
How to sell part of your land? Get in touch with your neighbor; they could be interested when you decide to sell part of your land. They can create a more secure boundary, expand their existing property, or limit future development in the area. You may also try contacting local builders taking on projects currently to gauge their interest in purchasing your land.
Why Are You Selling The Land?
One of the most common reasons to liquidate some of one’s assets is to increase one’s financial standing. An excellent method to bring in some additional cash if you possess a big plot of property is to sell it off for a profit. It might also serve as an alternative means of funding the upkeep of the remainder of your property.
Sharing wealth by selling or gifting a portion of one’s land is another popular option. You are aware, however, that improperly transferred ownership might lead to legal complications down the road.