Vacant Land BPO and What you Need to Know
BPOs are a great way for a real estate professional to make a few extra dollars each week. Occasionally, a real estate agent will need to do a vacant land BPO, or a BPO of land without a house. These can be tricky, but there are a few important tips to remember that will make doing a vacant land BPO much easier.
Nearby Lots of Similar Size
One of the most important things you can do to correctly perform a vacant land BPO is check out nearby lots of similar size and see what they’re selling for. It’s important to look at a variety of them, and then average out the price so you can get a good idea of what your lot is worth. Try to find lots with similar characteristics as well, such as cleared or partially cleared, close to the main highway, near parks, etc. This will help give you a good starting figure for your vacant land BPO.
Factor in Improvements
A simple lot that hasn’t been cleared would be considered “raw land.” However, if the property has been cleared and there are improvements, it will be worth more money. Determine whether the lot has a septic tank, a driveway, or hookups for utilities in order to help narrow down the value of the property. Having these things makes the property more valuable than raw land. Also factor in any other characteristics or improvements that would increase the value of the land.
Consider the Nearby Properties
Even though the lot is vacant, it’s important to consider the properties nearby. What sizes are the homes and are they in good shape? Are the yards maintained and manicured, or do the properties look as if they need maintenance? Is there garbage in the yards, or do the homes have visible damage? The characteristics of the surrounding properties and homes will factor into the value of the vacant land. Vacant land with high quality properties and well maintained houses and yards nearby will be worth more than those in neighborhoods that are run down or shabby.
If the land is in a great location, the value will be more. For instance, if the land is across the street from a park, within a mile of the nearby elementary school, or just a mile from the closest zoo, the value will increase. Take into consideration the location of the property and whether it’s close to any attractions, libraries or schools.
When doing a vacant land BPO, sometimes you have to work a little harder than with a BPO for a home and property. However, by searching for nearby properties with similar characteristics, factoring in improvements, location and considering nearby properties with homes, you can come up with a fair and legitimate value.
The Fannie Mae standard Residential form is used for most residential Vacant Land BPOs as opposed to a specific Vacant Land BPO Form. BPO Forms offers the Fannie Mae BPO Form and many others and hundreds of agents, brokers and others have generated a Vacant Land BPO through the system.