A competent solution to the question of how to sell leased land

Although leasing land can be a difficult process to sell, it can also be a profitable and easy process if done correctly. Knowing the ins and outs of this deal is essential whether you’re a company or an individual landowner. The goal of this post is to walk you through the crucial actions and factors that must be taken to guarantee a successful sale.

It’s crucial to first make sure you understand the terms of your lease. Understanding the rights and limitations of various leases will affect your ability to sell the land. Are there any provisions that require attention or authorizations from the tenant or other parties involved? To avoid future legal issues, it is imperative that you take this first action.

Next, think about your leased land’s market value. Its valuation is largely influenced by variables like land use, location, and market trends. Obtaining a professional appraisal can help set a competitive price and provide an accurate estimate. This guarantees you get a reasonable return on your investment in addition to drawing in potential buyers.

Another crucial component is effectively marketing the land you are leasing. Making a point of showcasing its special qualities and possible applications can help attract more potential customers. Using a variety of platforms—from local ads to real estate websites—can increase your exposure and speed up the selling process.

Finally, proceed cautiously during the negotiating and closing phases. It’s critical to comprehend the financial and legal ramifications of this. For the purpose of making sure all the paperwork is done correctly and safeguarding your interests throughout the transaction, it could be advantageous to work with a real estate agent or attorney who specializes in land sales.

You can answer the question of how to sell leased land with competence if you follow these steps. You can minimize potential obstacles and achieve a successful sale with strategic planning and execution.

General concepts of selling leased storage

Formalization of rental legal relations is contingent upon the outcome of auctions, as stipulated by legal norm Art. 39.3 of the Land Code of the Russian Federation.

Local governments can set them up:

1. In an open form – when the number of participants is not limited by anything.
2. In closed – only persons of certain categories can apply for participation in the auction (those with social and other benefits or persons with permanent registration at the location of the site).

The auction organizers select the following people to be the winner:

1. Auction. Its purpose is to set the payment rate for the leased plot. The participant who names the highest price is recognized as the winner of the auction.
2. Contest. Alternative to auction.

The rights of a land tenant can be assigned in the following ways:

1. Until the conclusion of the main agreement with the true owner of the site. Typically, such transactions are concluded for commercial gain, since the price of an agreement with a third party increases significantly.
2. During the period when all lease rights with the winning bidder have already been formalized with the owner of the land.

If the auction is deemed invalid due to insufficient participation or only one application, the tenant’s rights will not be transferable under the latter option.

In this instance, the contract is finalized at the minimum price, or the rate set forth at the beginning of the auction, within ten days of the closing of the auction. However, this participant’s right to transfer his rental will no longer be available.

It is not required to notify the owner when an agreement of assignment is concluded with someone else if the rental relationship with the owner is formalized for a maximum of 5 years. However, you ought to send a formal letter informing them of the tenant’s previous changes.

Although selling leased land can be difficult, it can also be profitable if done correctly. To begin with, make sure you comprehend the terms of the lease, including any limitations or lessee rights. To determine a fair price, evaluate the land’s worth and the state of the market. To navigate the legal and financial complexities, work with a real estate agent with experience in leased properties. Since the lessee may have other interests in the sale or the right of first refusal, it is imperative that all communications with them are clear. A successful sale and a seamless transaction are guaranteed by careful planning and expert guidance.

At the initiative of the owner (lessor)

The owner of the land is legally entitled to assign his rights to a new tenant in the event that the former fails to pay the full rent due or engages in unlawful construction or other activities on the property.

Under two circumstances, the lessor will be permitted to carry out these legally significant actions:

• if the main agreement contains a condition for transferring rental rights to a third party;
• unless the land lease agreement has expired.

In what cases can a transaction be completed and in what cases not??

If it does not infringe upon the rights of the prior tenant, the owner may formally execute a transaction for the assignment of lease rights to another interested party.

This effectively means that it is impossible to sell the leasehold rights to the land separately from the house if a residential building is constructed on the property.

The lease agreement with the new owner of a house is automatically extended upon the purchase of the property, in accordance with the terms of Art. 552 p.3 of the Russian Federation Civil Code.

Procedure

In order to file a lease assignment agreement, you need to get ready for:

• documents on the survey carried out;
• cadastral plan, which takes into account the location of the site;
• discharge from Rosreestr on encumbrance (lease), a copy of the contract with the employer;
• an extract from Rosreestr confirming that the plot belongs to its owner;
• receipt of payment of the fee for registration of the transfer of the right to use the site.

It is a good idea to draft an acceptance/transfer act that details the land’s condition, potential structures, and intended use.

Where to contact?

The documentation that has been gathered is sent to Rosreestr in order to officially register the transfer of land ownership. Following this, the newly appointed tenant of the allotment will receive an extract.

Nuances

Even in the absence of a formal justification, the property owner retains the right to end the tenant’s land lease agreement.

It will not be possible to lawfully terminate the tenant’s right to use the land to the same extent if the prior agreement did not allow for termination. This means that the right to administer the settlement cannot arise.

Conversely, if this is mentioned separately in the agreement, the land plot owner has this opportunity as well.

At the initiative of the employer (tenant)

Similar to other real rights, a lease may be assigned—that is, transferred—to a party who expresses interest as long as doing so does not infringe upon the rights of other individuals or groups.

Plots that are rented from local government agencies are typically sold on which a house’s construction has started but is not yet finished.

Before completing this transaction, you must notify the plot owner of your intention to transfer the lease right to another individual if the site is owned by municipal or state organizations. Should this not be completed, the transaction might be deemed void.

The assignment of the lease right to a third party will no longer be possible if a mutual agreement on the transfer of land for rent expressly states that the lease right is not permitted to be transferred in favor of third parties.

The terms and duration of the new agreement are the same as those in the one with the previous tenant.

What is needed?

The employer needs to take a few actions in order to sell leased land that includes an unfinished residential property:

1. Have in hand a copy of the notice given to the owner about the start of construction work on the site.
2. Obtain approval for the construction of a residential building.
3. Prepare a foundation pit or build a basement.

In order to officially record the tenant’s rights transfer, you must:

1. Order technical documents from the BTI for unfinished construction. To do this, you will need a lease agreement and permission to build a house.
2. Then register the property with the Cadastral Chamber, providing the same documents.
3. After this, register ownership of the begun construction of the house in Rosreestr and receive an extract.
4. Submit a new land lease agreement to Rosreestr.
5. Pay a receipt for registration work.
6. After 7-10 days, receive an extract about the ownership and change of tenant of the plot.

In the event that the leased plot is free of unfinished construction, Rosreestr will require the following paperwork to get any permits needed to build a capital structure:

• lease contract;
• assignment agreement;
• owner"s consent;
• passports of the parties;
• receipt of payment of state duty.

Where to get in touch:

1. You can send your application to Rosreestr in person.
2. Submit a set of collected documents to the MFC.
3. By submitting an application through the State Services portal (the service is provided only to registered users).
4. By mail, sending a registered postal item with a list of documents attached to the address of Rosreestr.

Peculiarities

Municipal management frequently just suggests ending the lease and returning the land to the state.

However, as the tenant may have to pay for land management (land surveying, technical plan, and Cadastre registration), this is incredibly unprofitable for them. It is best to sell (assign) your rights to a third party in such a situation.

When reaching a deal with someone who wants to buy leased land, the buyer needs to read the lease agreement very carefully.

1. The validity period of the land lease agreement; if it is expired, the transaction cannot be registered.
2. Is there a clause in the agreement about the possibility of assigning the rights of the tenant in favor of a third party?. If it is missing, the transaction cannot be completed.
3. If the agreement stipulates obtaining permission from the owner to conduct transactions, then this requirement must be fulfilled.
4. The transfer of land under a paid agreement involves payment, so the cost of the transaction must be stated in the agreement. Taxation on profits will depend on this if the property has been owned for less than 5 years.

Useful video

Watch this video to find out more about the sale of leased land:

Step	Description
1	Check Lease Agreement
2	Consult with a Real Estate Agent
3	Get Legal Advice
4	Notify Lessee
5	Prepare Land for Sale
6	Set a Competitive Price
7	Advertise Property
8	Negotiate with Buyers
9	Finalize Sale

It’s important to comprehend the financial and legal ramifications of selling leased land. Landowners can make sure they are making educated decisions by taking the time to go over the lease agreement and speaking with legal experts. This helps to ensure a seamless transaction while also safeguarding their interests.

Furthermore, keeping lines of communication open with the tenant is crucial. Maintaining a positive relationship and averting potential conflicts can be achieved by keeping them updated on the sale process and attending to any concerns they may have. A collaborative approach can speed up the sale and benefit all sides.

Last but not least, successful land marketing can draw in the proper purchasers. It can be more appealing to highlight the land’s possible uses and any improvements that have already been made. The likelihood of a successful sale can be increased by working with an experienced real estate agent, who will make sure the land is sold to a qualified buyer at a fair price.

Video on the topic

An ingenious response to customer objections | Handling objections in sales

Lease contract. Controversial legal issues regarding its extension.

Buying out a plot of land from a lease| Rental periods| Answers on questions

How to sell a plot of land? Instructions for selling PVN

Is it possible to sell land if it is leased??

Vlog #1 | How to sell a plot of land quickly and profitably | Show360 | Alexander Gorbunov

PROBLEMS AND RISKS OF TRANSFER OF LEASE RIGHTS TO A LAND IN 2024