Home Buying in 07044>Question Details

Jillsafken@y…, Home Buyer in

A development co. that owns the land. Do development co. normally negotiate? How do I negotiate a price? Do I need an appraisal?

Asked by Jillsafken@yahoo.com, Wed Jul 31, 2013

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Land prices are usually not appraised because there is typically no financing available. It is very difficult to pay anything but cash (unless the cash is coming from another source such as an equity loan secured by another home). If you plan on building on the land, then perhaps the builder/developer can package it together and get construction financing and you can do an end loan on the whole deal. If you are planning to GC the job yourself you will need to own the land and then have the foundation in before you get any financing.

When buying a piece of property through a development company, are there other pieces just like it being sold for the same price? Premium lots can have an up-charge. Usually large development companies (over 100 lots in size) are not that negotiable because of standard pricing regulations with the State of NJ; however, individuals can resale at whatever prices they want and can discount below developer prices. You can check for these resales in other places. In a new development, it can take time to set values on land because they are not normally reported to the MLS--only resales are. Therefore it's hard to get true value except for what the developer is charging. You can always try to negotiate the best possible price with the developer. Are they offering financing on the land? This always helps if they are. Developers offer financing when the project is early in infrastructure because you may need to hold the lot for some time before you can build.
I don't really know enough to be of great help to you but I hope you can pick up some general info in this post.
We are working with a builder in Verona, NJ right now who is offering new homes in a subdivision where you can pick your lot.
We are well versed in new construction having owned our own construction company for many years.
Contact me if you need further info.
Sandra Bolcar
Broker Associate
201-247-5768
sandra@thebolcarteam.com
0 votes Thank Flag Link Wed Jul 31, 2013
You can always make an offer. You'll need an appraisal if you're getting a loan.
0 votes Thank Flag Link Wed Jul 31, 2013
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