How to negotiate with a real estate developer?
If you want to sell your land to a real estate developer, know that you have several negotiation levers. A real estate developer seeks to buy land and then build.
The profession of real estate developer
When it comes to negotiation, it's always important to know who to deal with! The real estate developer has the most important job in the real estate world. It is in fact he who takes care of buying the land to build and then finding buyers.
The real estate developer has skills in several areas, namely law, construction, real estate and sales!
As a professional, he will always seek to obtain the best price, since his margin depends on it.
As a seller, you will seek to obtain the best selling price for your land!
How to negotiate with a real estate developer?
What is the promoter's project?
Make sure you get as much information as possible about how the developer intends to use the land in question. This will allow you to estimate the potential of the land - from the promoter's point of view - and therefore to announce a fair price.
The constructability of the land
As you know each locality has its own building rules. If it's very permissive, it allows you to charge a higher price.
Neighborhood
When is he from the neighborhood? How will it evolve in the coming years? Are there other construction projects in the area?
For further advice on negotiating with a real estate developer, we invite you to consult the MeilleurPromoteurs.immo site which has an article on the subject, of which here is an excerpt:
It should be understood that the promoter will only be able to buy your land once he has definitively obtained the building permit. Appeals from neighbors or the town hall may extend the deadlines, or even lead to the cancellation of the project. This is why it is important to work with a reliable promoter who knows what he is offering. Thus, you will avoid unpleasant surprises.
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The state of the real estate market
As in many sectors, the state of the market will play an important role in terms of deadlines and the sale price. In real estate, we are facing real fashions. For example, if there is a trend towards the construction of eco-housing in a given district, a promoter will be in a more hurry to develop such a project, because he will be sure to sell it well.
If you own suitable land in said neighborhood and know this trend, you will be able to negotiate a great selling price.
How to sell calmly to a promoter?
Selling to a promoter is therefore a complex and long process which will require mobilizing or acquiring many skills, sometimes technical. This is why professionals can assist you in studying the potential of your land, then put you in touch with the most reliable developers to exploit this potential! Thus, you will be sure to sell at the best price, as soon as possible, in complete safety.
Here are two pitfalls to avoid when selling to a real estate developer
Negotiation is a conversation aimed at reaching a mutually beneficial agreement. For example, the goal of a negotiation between a real estate developer and a land seller is to reach a mutually beneficial agreement for both parties. The land seller wants the best deal possible and a property developer wants an acquisition that is within their budget. According to our source: Sporting Promotion, here's what to avoid when selling to a real estate developer.
Don't be irrational
During the negotiation, be rational. Negotiating with a real estate developer is very different from negotiating with a grocer. You should have a well thought out strategy, especially if this is your first land sale. On the other side, there is a very experienced negotiator.
Avoid being unrealistic
No developer will react well if the seller of land starts negotiating with an unrealistic price. It's fine to quote a price that's 15% above the listed purchase price, as this is generally considered acceptable. However, when you start the negotiation, make it very clear that you are genuinely interested in closing the deal.
