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Post by Freeborn on Feb 28, 2017 13:51:51 GMT -6
Many of us have land and/or are thinking about adding land or buying more land in our futures. I want to get your input on the positives and negatives of buying land that has rentable land compared to just hunting land. The rentable land has income but cost more to buy.
What do you see as the positives and negative. I posted an amortization comparison. Attachments:
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Post by kl9 on Feb 28, 2017 14:43:44 GMT -6
It is generally taxed less and can cover taxes if bought properly. Diversifies the pool of potential buyers should you chose to sell, of course depending on % of tillable. Wildlife food source.
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Post by kl9 on Feb 28, 2017 14:45:58 GMT -6
Plus I love farmland, especially in the driftless region
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ace
Full Member
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Post by ace on Feb 28, 2017 16:54:19 GMT -6
No brainer to me. Rentable hands down.
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Post by Sandbur on Feb 28, 2017 18:45:01 GMT -6
I like rentable, but it depends on the neighborhood.
I bet I could sell my place in one parcel and sell it in three days. Break it up into three parcels, make more money, and sell it in three months. Be careful with rental crop land. How many renters are available?
Do your fields match the size of their equipment, or is only one renter really in the market because of small or misshapen fields?
Jerry, you have seen my place. The big field has one group of potential buyers. The rest of the land could be broken into 2 or 3 more places for rural homes.
More likely, a friend or neighbor would want it all for them or a family member to live here, hunt a bit, and help on the family farm.
The day I bought the farm on an auction, 4 neighbors asked if they could rent it. One wanted the pasture and 3 wanted crop land.
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Post by Freeborn on Feb 28, 2017 19:10:44 GMT -6
I like rentable, but it depends on the neighborhood. I bet I could sell my place in one parcel and sell it in three days. Break it up into three parcels, make more money, and sell it in three months. Be careful with rental crop land. How many renters are available? Do your fields match the size of their equipment, or is only one renter really in the market because of small or misshapen fields? Jerry, you have seen my place. The big field has one group of potential buyers. The rest of the land could be broken into 2 or 3 more places for rural homes. More likely, a friend or neighbor would want it all for them or a family member to live here, hunt a bit, and help on the family farm. The day I bought the farm on an auction, 4 neighbors asked if they could rent it. One wanted the pasture and 3 wanted crop land. Good thinking Art, having renters and preferably multiple renters would be a preferred. The schedule I provided is a financial comparison but is there any positives to sticking with all woods for hunting?
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Post by MoBuckChaser on Mar 1, 2017 6:04:44 GMT -6
I agree with ART. There are a lot of differences in buying and renting land out areas. I can spend $2,000 an acre in MN and rent it out for $50 a acre and pay $25 an acre taxes. But a better choice has been to buy land for $2,000 an acre in Missouri, rent it out right now for $175/200 an acre and pay less than $3 an acre taxes. Should be a no brainer for everyone!
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Post by Freeborn on Mar 1, 2017 6:45:54 GMT -6
I agree with ART. There are a lot of differences in buying and renting land out areas. I can spend $2,000 an acre in MN and rent it out for $50 a acre and pay $25 an acre taxes. But a better choice has been to buy land for $2,000 an acre in Missouri, rent it out right now for $175/200 an acre and pay less than $3 an acre taxes. Should be a no brainer for everyone! Why is there such a large difference in rent per acre between Mn and Mo? More fertile in Mo, longer growing season, less inputs? I have been on the WEB looking at MO properties and there are some properties where the realtor claims the hay ground could be row cropped or overgrown pasture could be converted to farm land. Seems like local farmers would have already did this if there was anything to gain. I would not trust a Realtor. In Minnesota farm country there are farmers everywhere, in Missouri are there certain areas (like the NW) where farmers are a distance away where renting could be a problem?
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Post by kl9 on Mar 1, 2017 7:17:24 GMT -6
I agree with ART. There are a lot of differences in buying and renting land out areas. I can spend $2,000 an acre in MN and rent it out for $50 a acre and pay $25 an acre taxes. But a better choice has been to buy land for $2,000 an acre in Missouri, rent it out right now for $175/200 an acre and pay less than $3 an acre taxes. Should be a no brainer for everyone! Are you still seeing transaction prices of 2000 an acre or are things increasing?
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Post by MoBuckChaser on Mar 1, 2017 7:38:49 GMT -6
The longer growing season takes a lot of the risk out of a poor crop. As well as provides the opportunity to grow more bushels per acre because of the longer growing season by using later maturity seed. So farmers can get a lot better insurance coverage, for a lot less money in those areas compared to my area up here. Therefor they can pay more for land rent! A lot more!
You are correct, never trust a real estate agent in MO, or anywhere for that matter. But dont trust anyone in life either, real estate or not. Verify everything if you want to avoid a huge loss.
There are a lot of farmers in Missouri and Ia that need to rent land, no matter how small the chance of profit. A lot of them have dug themselves holes that are not climbing out of with extremely high equipment costs, that are depreciating faster than the payments they make. Tractors, tillage equipment, sprayers, combines, planters, trucks, trailers, grain carts, grain bins, sheds, on and on, all cost big money new, and there is a lot of new green equipment down there. They are equipment poor! They have there priorities crossed up with buying green paint verses the place to drive them on, and the only way out of going under means to rent more land, and a lot of it. They drive the rent up on themselves. But as we have found out, you get the rent paid up front and in jan for the year you are leasing in. That makes sure you are paid, and if not, you get 3 months to find a new idiot to rent your place.
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Post by MoBuckChaser on Mar 1, 2017 7:50:50 GMT -6
I agree with ART. There are a lot of differences in buying and renting land out areas. I can spend $2,000 an acre in MN and rent it out for $50 a acre and pay $25 an acre taxes. But a better choice has been to buy land for $2,000 an acre in Missouri, rent it out right now for $175/200 an acre and pay less than $3 an acre taxes. Should be a no brainer for everyone! Are you still seeing transaction prices of 2000 an acre or are things increasing? Investors are piling more money in the stock market now then ever, leaving land behind for the most part. So some land deals are to be had now and in the future. But you will rarely see them listed. Until the stock market retracts and the commodity prices rise it will stay that way. But that will open up opportunity's for buying land in you are in the market. There are a few guys selling some parcels when they reduce the price in MO, but a lot of what is being offered is land owned by investors right now. Guys like me that buy and sell. None are really looking to give them away, so you won't see a bunch of drastic price reductions for what is on the market. They will keep it artificially inflated, while we all bottom fish some more properties behind the scene now, to sell in the future.
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Post by Freeborn on Mar 1, 2017 8:24:40 GMT -6
Are you still seeing transaction prices of 2000 an acre or are things increasing? Investors are piling more money in the stock market now then ever, leaving land behind for the most part. So some land deals are to be had now and in the future. But you will rarely see them listed. Until the stock market retracts and the commodity prices rise it will stay that way. But that will open up opportunity's for buying land in you are in the market. There are a few guys selling some parcels when they reduce the price in MO, but a lot of what is being offered is land owned by investors right now. Guys like me that buy and sell. None are really looking to give them away, so you won't see a bunch of drastic price reductions for what is on the market. They will keep it artificially inflated, while we all bottom fish some more properties behind the scene now, to sell in the future. Depending on Trumps success ramping up the economy we could see an acceleration of investors out of land and into the market. A sign of good economics might trigger some selling just because investors don't want to miss the market. You probably don't even need a huge market run just good signs it could happen.
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Post by MoBuckChaser on Mar 1, 2017 8:41:21 GMT -6
Investors are piling more money in the stock market now then ever, leaving land behind for the most part. So some land deals are to be had now and in the future. But you will rarely see them listed. Until the stock market retracts and the commodity prices rise it will stay that way. But that will open up opportunity's for buying land in you are in the market. There are a few guys selling some parcels when they reduce the price in MO, but a lot of what is being offered is land owned by investors right now. Guys like me that buy and sell. None are really looking to give them away, so you won't see a bunch of drastic price reductions for what is on the market. They will keep it artificially inflated, while we all bottom fish some more properties behind the scene now, to sell in the future. Depending on Trumps success ramping up the economy we could see an acceleration of investors out of land and into the market. A sign of good economics might trigger some selling just because investors don't want to miss the market. You probably don't even need a huge market run just good signs it could happen.
I would not wait for a acceleration of investors out of the land markets any time soon. You still have guys like me that are getting good returns renting out farm land. A lot of land was bought at great prices.
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Post by smsmith on Mar 1, 2017 9:02:40 GMT -6
Market investors musta liked the Donald's speech
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Post by kl9 on Mar 1, 2017 9:06:51 GMT -6
MO if I promise to stay out of Missouri want to give me some bottom feeding tips on finding deals?
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