This is a great read for those new to land sales and purchases, especially thru auction companies.
There is a local auction company in N. Mo. And I'm surprised anyone gives them any business considering the way they advertise/market the properties they get.
Whenever I call them for information on a property they have none of it available, no plat maps, no soil surveys, no aerials. It's absolutely crazy to me. Yet, they've been in that area for 30 or 40 years, and the locals will still give them the business. I just shake my head because they are doing such a disservice to both the buyers and seller. As a buyer, I can probably buy some of that ground cheaper than a well run auction, but I get so frustrated at the lack of information available I quit the pursuit.
So, the above post is something I've experienced first hand. As a seller, I'd NEVER hire some of the companies out there.
Good comments and I see that a LOT, particularly with some of the big auction companies. A lot of times they'll have a grand total of maybe 5-10 photos on the auction listing for a 100+ acre property, and none of them very good. Almost certainly no trail camera photos. You certainly are not getting a very personalized level of service like you are from a lot of land agents.
The honest truth is that who a land seller lists their land with most often has to do with one thing.
$. Snazzy advertising, good reputation and track record of sales only go so far when there is someone out there who says they can get them more $ for their land, or can do it at some crazy low commission rate.
Whoever gives them the prospect (whether real or not) of walking away with more money in their pocket, more often than not, that is who they're going to list with. And who can blame them? But the unfortunate reality is that promises and projections are cheap and the end result in those situations where expectations are set poorly is often a landowner who is not happy on closing day with the amount he walk$ away with in his pocket. A lot of landowners don't stop to wonder whether that much lower commission quote from the realtor is going to get the landowner the same level of service or advertising as someone who might charge a little more normal commission amount. Saving $10,000 on commission isn't worth much if you lose out on $25,000 of sale price because you got a shoddy quality listing that wasn't marketed thoroughly and properly, with sub-par quality photos. I know it's a cliche, but in land selling it often is in fact true that "you get what you pay for".
I did a land evaluation down in Missouri a few months ago on some tillable land that was "Fair to Middling" quality. I suggested a list price a little over $5k/acre because I thought that was pretty close to the market with a little bit on top for negotiation with a buyer. I've got a farmer friend who lives in the area and he backed up my idea of market value. The landowner got back to me and said he was going to go with a different realtor (he told me who) who had told him he was confident he could get him (I'm not going to say the exact figure)....a couple thousand more per acre. Not a realistic expectation at all, there's no way that land would sell for that, especially in this market and with corn and beans priced where they are currently. I told the landowner to be careful about locking himself into a 6-month exclusive contract to sell with anything *close* to that expectation on $ale price. He said thanks for the input and that's the last I heard from him. I haven't seen it listed yet by that other realtor, so who knows, maybe the landowner had 2nd thoughts and is still considering options.
Landowners have the final say on list price no matter what the realtor says, but it's true to say that some (not all) realtors are so eager to get any listing that they will gladly go along with the number the landowner wants even if it's not anywhere close to realistic. That only hurts the process because it leaves the landowner with a "professional" opinion that their land actually is worth whatever high number they sometimes think, even if it's not realistic. They probably don't feel the same way on closing day 5 months later, though, when they "settled" for a number....much lower. Again, all about expectations setting.
One of my really big pet peeves is with some of these big auction houses that have a "buyer fee" on top of the final auction winning bid price. That way they can sell the landowner on their services with the pitch that "the buyer will pay our fee and you will owe us little or nothing, how can you lose?!?!" This is undoubtedly a *very* enticing sales pitch for land sellers who aren't experienced at selling. In many cases likely an older couple, a widow or widower, or grown children who are heirs of a property they don't have any remaining connection with and just want to sell and get as much money as they can. Again, who wouldn't want that??? But savvy land buyers know the "buyers fee" game at auctions, and they're going to bid that much less because they know they're going to have to pay the "buyers fee" on top of what the auction winning bid is. So in reality the land seller is very likely not walking away from the auction with more money in their pocket, and in fact may be walking away with less because of the lesser personalized service and experience of selling land through a traditional listing vs. an auction by an auction company that sells anything anyone wants to auction and doesn't really specialize in marketing to land buyers.
