Seeking advice on rural/farm land investment. New to this. Any tips?

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  • #91591 Reply

      We’re interested in buying rural/farm land as an investment. We are new and naïve to this. Please share any advice you have!

      #91592 Reply

        We own our house and 5 acres, a 160 acre plot, a 142 acre plot, and a 75 acre plot. I train Retrievers and have built ponds all over the 142 acre place. We run cattle on the 142, have the 75 leased out for cattle, and I train / hunt / guide on the 160. I can tell you this… You can’t buy property and pay for it by raising cattle on it like you could 20 years ago.

        The properties I bought in 98 and 2001 have been substantial in increasing my net worth, but unless I sell, they do nothing for my income (except the little bit of cattle income I get).

        I’d really think about what your plan is before jumping into this. If I weren’t making my living training dogs on it for the last 20+ years, I’d have been better off investing in the stock market.

        #91593 Reply

          I am in rural mid Missouri. Unimproved land is commonly leased for the price of annual taxes and no more here.

          That said, I do know one person who is doing very well for himself by buying several hundred to several thousand acre plots and subdividing them and harvesting the lumber off of them, and then running utilities to them and then selling as improved smaller plots of land. However, this person knows everybody in a 75 mile radius. Personally, I think, without his decades worth of networking and relationships, his particular scheme would not be reproducible.

          Don’t miss: What’s been the best investment you’ve made?

          #91594 Reply

            I did it but not for and investment. I wanted an off the grid cabin far away from people with cows on it that once belonged to my family generations ago. It’s probably appreciated a ton but I don’t plan on ever selling it. I lease it to ranchers since I got out of the cattle business.

            #91595 Reply

              Not a good investment for someone who is new and naive. I would pick something else.

              And don’t combine investments with “things that sound cool to own.”

              #91596 Reply

                Rural land doesn’t really appreciate, and if it does it probably won’t outpace inflation or regular market investments. I’ve been through this twice, once with my own foolish investment purchase right at the bottom of the market in 2010 and once after inheriting land from my dad.

                In rural areas buyers have their pick of land to buy, and it would take the right buyers to want the specific land you own.

                After paying taxes on it for a few years, you’ll be lucky to break even on the sale.

                Worth a look: Already have savings… But I’m a newbie to the investment world – How would you invest that money?

                #91597 Reply

                  Good luck finding an ROI!

                  I did the same and seriously the ROI is terrible.

                  #91598 Reply

                    There’s a lot of gray with that. Are you buying hoping that someday a developer will want it for a subdivision or big box store? Do you want to rent it out to a farmer to grow corn/soy? Do you want it to just sit vacant?

                    #91599 Reply

                      Learn about it before buying. It’s not for the weak. Types of crops raised, typical rainfall, irrigation potential, property taxes, government regulations, typical rental rates… that’s just some of the things to consider. What is the purpose of your purchase?

                      There are a lot of variables.

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