3 things you should know before selling your land.
Land is an asset that increases in value over time, and it can also be developed to further increase its value without waiting. Therefore, buying land to resell, or selling inherited land, can yield enormous profits. However, "selling land" is not easy; it requires careful consideration and an accurate understanding of future location prospects. Before selling land, there are at least three important things to know:
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1. Understanding the Undeveloped Land Price Index
The undeveloped land price index measures the average price of undeveloped land in a given year compared to the average price of undeveloped land in other years. This figure reveals the trend of land prices increasing. If the undeveloped land price index in a particular area is significantly higher than in previous years, it indicates the future potential of that location, as development will further increase its value. Therefore, before selling or buying land, you should survey the undeveloped land price index to determine the future potential of the land you intend to buy or sell. This will help you decide on the most profitable price for your purchase or sale. For example... Data from the Real Estate Information Center (REIC) on the index of undeveloped land prices in Bangkok and its surrounding areas for the first quarter of 2021 shows that the top five locations along the mass transit lines with the highest land price growth rates are, in order: the Blue Line (Bang Khae-Phutthamonthon Sai 4), the Gold Line, the Orange Line, the MRT Dark Red Line, and the BTS Sukhumvit Line. This reflects the trend that land in these locations has great potential. If you plan to sell, you need to set a good price, or if you plan to buy, you need to plan your investment carefully to get the best possible price.
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2. Knowing how to accurately determine land valuation
Of course, selling land for the most profit and value isn't just about selling it for more than the purchase price, but also about selling it at a price that reflects its potential. As is well known, land increases in value over time. Furthermore, if the area is developed with new roads, mass transit lines, and additional buildings in the future, the land price will only rise further. Therefore, when deciding to sell land today, it's crucial to accurately assess the current price and incorporate the potential for future price increases. This ensures that today's transaction doesn't miss out on significant opportunities for future land price appreciation. When pricing the land, you must highlight its strengths and future potential for value appreciation, highlighting these as key selling points to buyers. For the most accurate current land valuation, you can request services from the Property Valuation Office or use their online service at the Department of Treasury website (treasury.go.th). This is considered the most reliable and accurate way to calculate a preliminary land valuation.
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3. Know Your Expected Expenses
Even inherited land, which might seem to have no cost, the selling process involves expenses that need to be factored in. These include income tax, transfer fees, and stamp duty. Furthermore, before a successful sale, there are marketing costs involved, whether through offline signage or online advertising. If using a real estate agent, you must also calculate their commission. These expenses are costs that must be carefully planned to ensure sufficient funds for a successful sale and to determine a profitable selling price.
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Selling land involves many details and procedures that need to be learned and understood to ensure a smooth and legally compliant process, thereby maximizing profits as planned. Therefore, before selling land or venturing into the land trading business, thorough research and knowledge acquisition are essential. Closely monitoring real estate news is crucial to using factual information and in-depth analysis to inform decision-making and plan pricing for the most effective transactions. For those seeking quick and accurate real estate information, the Real Estate Information Center website (www.reic.or.th) regularly updates information on current events across Thailand, providing comprehensive coverage of all aspects of the real estate market.
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Thank you to REIC for this valuable information.
