Real estate development - land pricing

If you are an inexperienced land buyer and an untrained investor at the same time, pricing your plot of land for real estate development is going to be a very difficult task. As someone who majors writing articles about real estates, I can say that using comparable for land is very risky.

As nolensville Tennessee Realtors have observed, it sometimes caused failures that should have turned to be tremendous successes.

Before you could put a price to your plot of land, you must first make an evaluation and according to savvy, successful investors, there’s one effective land evaluation method that is accepted by a greater number of people in the real estate industry. In fact, this method has been used by corporations, property development professionals, and realtors. This method is called “the Land Residual Method”.

The Land Residual Method offers many benefits, but the greatest of its benefits is its ability to help determine the current value, as well as the future value of any land. Be it in residential or commercial estate. Another benefit is that it can give your land a price. It is able to give your land a price and that’s a great thing. Now, if you want to try this method, you should know that it will take some time, may be, few months to be able to employ the method.

In Real Estate listings in cool springs TN, if the name sounds a little intimidating and you think it will be  hard for you to use it, then you are wrong. The Land Residual Method may sound intimidating and fancy, but it is actually a simple math. All you have to do is to get a great understanding of it and you will be ready to use it. In fact, it is simply a calculation. A calculation that goes like this, “takes the highest and best use of a particular piece of property and subtracts out the total cost of development”. That’s how simple to get the land residual value.

Warning: you get the land residual value, but the task doesn’t end there. You still have to get the “numbers”, you don’t have to worry though. It takes some time as you need to do some research, but even a novice investor can figure it out relatively quickly.

I understand that you want profits. That’s what an investor wants— profits. To have that, you have to work that into the equation before you price your plot of land and make your offer.  To tell you, most residential property developers aim to make 20%-30% profit on every land property. I hope that made sense.