What should I do if I am approached to sell my property?

If you are not interested in selling, then you should say so.

If, however, you are interested, or are potentially interested if the right offer comes along, then there is nothing wrong with having open discussions about your property. You should not, however, enter into any legally binding agreement or contract without first having obtained legal advice.

Documents presented to you may take the form of a clearly labeled Contract, but they may also be labeled as “Letter of Intent”, “Letter of Agreement”, or other language which might indicate that there are no legal obligations being created.  You need to be aware that it is not the title of the document which determines whether it creates legal obligations, it is the nature of the transaction and the language inside the document.  The substance of the document is more important than its form.

If you do wish to sell, then it will likely be important to you to obtain the highest possible sale price.  There are steps you can take in advance of selling your property or entering any agreement to sell your property which you should be aware of.  What those steps are will depend upon the particulars of your property and a number of other factors.

You need to be aware that there are individuals out in the market whose business it is to make money from entering into contracts and agreements which defer or delay any obligation on them to pay the property owner.  These are not “developers” in the true sense.  They are “flippers” who in many cases then sell their contract with you to somebody else.  For example, they might agree to purchase your property now for $600,000/acre, but they only pay a fairly small deposit, and they don’t have an obligation to complete the purchase and pay you for your property until 12-24 months later.  If they ultimately proceed with their purchase, they are paying substantially less than market value because the property at the end of that 12-24 months is worth significantly more than it was when the contract was entered into.  The buyer may also never even complete their purchase, but instead sell or assign their rights under the contract to somebody else.  For example, they agree with you at the $600,000/acre value, and they then sell to somebody else (perhaps a developer) 18 months later for $800,000/acre.   However, they don’t sell the property, they sell their right under the contract to purchase your property.  The new buyer pays $800,000/acre, you get $600,000/acre, and the middle man keeps $200,000/acre.  That $200,000/acre increase in value is really money which you should have gotten instead of the middle man.

This is just one example.  There are many others.  Beware and get legal advice.

Also, if you are not comfortable dealing with these types of transactions, get advice from your family members and close family advisers.  The more eyes that look at a deal, the less likely it is that you will be taken advantage of.