Real Estate Business Still Jumping At The Cemetery

If a customer has something that's worth $3,000, that could pay for utility bills and living expenses... They're not thinking of the future. They have something they're able to sell and get money for now.

Story from the Wall Street Journal

For nearly 20 years, John Dotson planned to spend eternity at Block 29L, Lot 58, Site 1DD at Parklawn Memorial Park in Rockville, Md.

Heaven will have to wait. Plagued by a series of misfortunes at home, from job loss to multiple illnesses, Mr. Dotson has decided to put the double plot he had bought for himself and his wife up for sale. "Things got really tight," he says, and his wife has come around to the idea of cremation.

He purchased the plot in 1990 for about $1,500, and though the cemetery now values it at $4,555, Mr. Dotson says he would gladly unload it for around $2,800.

As if the recession hasn't ruined enough people's plans in this life, it now seems to be disrupting the hereafter as well. Cemeteries and funeral-property Web sites report a burgeoning marketplace for the sale of burial plots by individuals, many of which have been in families for years. As times get tough, they are now being liquidated to make ends meet.

In Orlando, Fla., Greenwood Cemetery has seen a record number of customers coming in to sell their plots back to the municipal-owned facility. Don Price, the cemetery's sexton, or manager, has had 44 "buybacks" in the first six months of this year, compared with 42 in all of last year and only 11 five years ago. Greenwood considers what a customer paid for the plot, and will offer as much as $1,500 if someone wishes to sell it back to the cemetery, which can then resell it on the open market.

In Dayton, Ohio, David's Cemetery reports that in the past year it has seen roughly double the number of clients coming in to sell their spaces back to the cemetery.

Web sites such as Grave Solutions and Plot Brokers, which advertise spaces and broker sales of cemetery properties, have also seen an uptick in postings. Caskets-N-More, a Glendora, Calif.-based business that sells funeral products and brokers sales of cemetery properties, reports a doubling of people wanting to sell their plots, to about 20 new postings a month from 10 a year ago.

"If a customer has something that's worth $3,000, that could pay for utility bills and living expenses," says Caskets-N-More owner Olga Fernandez. "They're not thinking of the future. They have something they're able to sell and get money for now."

Grave Decisions

The apparent increase in sellers of cemetery plots has to do with more than just economic necessity. Changes in how people live and wish to be buried also play a role. Increased mobility means individuals may no longer live near a family plot and would rather sell off unused spaces. And growing acceptance of cremation as an alternative to burial means people realize they may have no need for previously purchased in-ground plots.

But while many plots are sold that are no longer needed, other families are reluctantly giving up their plans of being buried near their loved ones.

"I've had widowers sell back spots next to their spouses, and only because they needed to pay rent," says Mr. Price, Greenwood's sexton. In such cases, the cemetery will pay for the space, but hold off on putting it on the market for a month, in case the seller is able to come up with the money to buy it back.

The Los Angeles-based Web site Plot Brokers is representing a family that wants to sell a multiplot area worth about $350,000—and is in the process of moving someone already buried there in order to sell. In recent months, Baron Chu, who runs Plot Brokers, has noticed a big increase in people willing to sell high-end plots—an indication of how desperate some people are for funds. "Usually people that already have money aren't the ones looking for money," says Mr. Chu.

The crypt above screen siren Marilyn Monroe in Westwood Village Memorial Park in Los Angeles was posted for sale on eBay on Aug. 14 with a starting bid of $500,000. By Aug. 24, bidding topped out at $4,602,100, though the offer, from Japan, was later rescinded. The plot hasn't yet sold, and eBay is currently working with the seller in hopes of having her relist it, says a company spokesman.

Plots sell quickest and cost the most in places where people tend to retire—such as Florida, Arizona, Texas and Southern California—according to Ken Brant, who runs the Grave Solutions Web site.

For example, there are over 500 plots for sale on Grave Solutions for Restland Cemetery in Dallas, a 375-plus-acre facility owned by Jefferson, La.-based Stewart Enterprises Inc. The listings reveal some potential bargains—as well as sellers in a hurry: "REDUCED," reads one listing for a single plot in the Masonic section where the seller is asking $2,200. Another listing invites buyers to "make an offer" for two burial plots in the Garden of the Cross. Another seller is asking $4,500 each for his three plots in the Garden of Gospel—or $12,000 if the buyer buys all of them.

One posting for Restland's desirable Whispering Waters section says $40,000 will buy you two "packages," complete with services, caskets (choice of copper tone or silver tone) and bronze memorial.

With so much inventory on the market, it could be a great time for a consumer to buy. Generally, sellers post plots for about half of what a comparable one would retail for at the cemetery. These days, because there is so much inventory, "people are much more willing to negotiate," says Jeff LaGrone, a Charlotte, N.C.-based cemetery-plot broker who helps run a Web site called American Cemetery Property.

Precautionary Measures

Before buying property on the secondary market, you need to take some precautionary measures. First, make sure the seller is the owner of record with the cemetery. If he inherited the property from someone else, but neglected to alert the cemetery, for example, he likely can't transfer ownership until the books are straightened out.

When selling property, check with the cemetery first to see what the rules are. For the most part, cemeteries will allow plot owners to sell their space on the secondary market—though it's worth checking first to see if the cemetery itself will buy it back. (Most don't, says Robert Fells, general counsel for the International Cemetery, Cremation and Funeral Association, since cemeteries generally aren't lacking for spaces to sell.)

When shopping, be sure to ask what's included in the price. Some properties include ancillary costs, such as the burial and headstone. Others include only the plot itself. Check with both the seller and cemetery about what exactly you are paying for. Mr. Dotson, for instance, is selling only for the rights to the land. The buyer would eventually need to pay for the two in-ground crypts, which together would cost an additional $2,340, as well as other fees.

Another option: a so-called pre-need purchase, in which you purchase funeral arrangements, which may include cemetery space and funeral services, in advance of your death, before your survivors are grieving and easily fleeced by salesmen. But it also might not be a bad place to park your money, given how rapidly burial costs are escalating. Average funeral prices in the past decade have increased by about a third, to $6,199 (not including the cemetery plot), according to the Springfield, Ill.-based Federated Funeral Directors of America, which tracks costs annually.