First time doing this need some advise! Thank you.

[lovinnature]

Hello;

Me and my son are thinking of purchasing a piece of farmland property to raise some farm animals and do some fruit and vegetable growing. This is the first time we are doing this and we have no idea on what to look for. We are looking to purchase farmland to take advantage of some of the lower costs that have appeared due to the economy but we want to know on what we should look for and how we should negotiate to get a good deal on a piece of farmland property.

There is a property me and my son saw that intererested us allot and the owner said we could either purchase 7 acres or more at $4,500 per acre (is this a good price or not?) but would like to see if he could lower ir to $3,500 or $3,000 per acre if possible. He is offering owner financing and with monthly payments and interest but we are not sure if we should purchase it with owner financing or not. We also dont have an idea if we should purchase the 7 acres or less or even more to get a cheaper price per acre.

If we were to purchase farmland we are looking to purchase it to make some profit and to grow our own food. We do love animals and have had this in mind for many years but have not had the opportunity since farmland costed much more a couple of years ago than it does now.
What would you guys recomend in doing to generate a profit? (broilers, Pigs, corn/vegetable growing, Layers, sheep, etc)


I greatly appreciate the help from anyone that has gone through this already and/or has ideas on this new venture of ours.

Thank you all.

 

[rebelcowboysnb]

The price sound ok but its all relative to the marked you are in a the land itself.

Never new a farmer to say "I bought to much land" but you here them saying "I wish I had more" all the time. So I say buy what every bit you can afford. An if it was me I would use a bank.

As for profit? Veggys are ok if there is a market there. Corn is worthless on the small scale. Hard to make any money in chickens. Hogs do ok an so do cows. Most farmers on the 2 to 10 acre range are trying to zero there grocery bill output an have healthier food more than have an income. Not that it cant be done.

 

[Teach97]

totally depends on where you are...where I am...people would line up to sell you land at that price!

You need to go look at your county tas agency to see what stuff is selling for. Then you look at the land and what it looks like as far as drainage and what is growing there...if it is already farmland you need to see what it has produced historically...

7 acres is hard to make much money on from a commercial standpoint with livestock unless you do a very specific niche market. Talk with your local ag agent about the cow or other animal ratio to land needed. In my area...7 acres might raise a couple goats. Corn and such probably will not work...truck crops...vegetables will tunr a profit but will require lots of work and a knowledge of the market...

I would never do a owner finance option...go with a bank

 

[lovinnature]

Is there a reason why you guys do not recomend owner financing? I actually thought that owner financing was a better option for people that might have difficulty lending from a bank with all their hidden fees and how banks are. Owner financing with monthly payments with terms over 5-10 years with some 12% interest does sound somewhat good. Also what if i actually make enought during that time to pay everything off would it be more convenient doing this with a bank of the owner of the property?

Thank you.

 

[Teach97]

12% is next to highway robbery at this point. Interest rates are at all time lows...the only reason a person would use owner financing is because your credit is so shot nobody would lend to you...except a loan shark

The thing about owner financing is that usually things are done with hand shakes and promises...not a good deal when it comes to business ( I wouldn't trust my mommmy...and i really like her!!) You gotta draw things up and have attorney's look at it....not just theirs! You still need to have surveryers come look at it...these are the so called hidden fees that folks talk about..they aren't hidden....they are good measures to protect everyone.

the other thing is that folks that really want to do owner financing are sometimes hiding something....not always but...


When you get a loan...go with fixed rates...not adjustable rates...no ballon payments....no penalties for early pay-off....no points payed...they math doesn't work on them...

just my thoughts...

 

[Spookwriter]

Owner financing is almost NEVER in the buyer's favor. Not in homes, land, car,
furniture or anything else.

Business is business. Take it to the bank if you need to borrow. Nice and legal.
Now, if the banks turn you down it's time for you to ask yourself if you can really
afford the deal.

I would think it to be very hard--but not impossible-- to make the land pay for itself
if that's what you're asking. Look around--very few of us farm for the money. But yes,
your seven acres can certainly pay you a percentage.

Depends on the general condition and location of the land of course. We're talking
as in seven acres of uninproved land? (Hillside, pasture, woodlands, wetlands?) Utilites?
Any buildings at all? Fenced? Roads?

So much goes into the equation before I can say it is or it is not a value.

Big thing, is this where YOU want to live for ten-twenty years? Or do you think it can be
flipped?

How many small farm's in your area? Talk to them. Watch them.

 

[rebelcowboysnb]

Go to the feed store an pull up a chair for about a week. What is everyone buying... What are those people driving? How are they dressed. People watch a while an you will learn what is making money in your town.

 

[ninny]

Go to a bank and get a realtor who knows the area. The last thing you want is to find out after you bought it that the water table is so high you live in a swamp or some other nasty thing. We almost learned that the hard way. Does it have a house already? Lots of questions. You really need a professonials help if this is new. We always have a lawyer at the closings too. We've had people try and do all sorts of nasty scams with closings.

 

[lovinnature]

Thank you all for the posts, I really do appreciate the advise.
Well the property has a type of barn that has a dweling(that could be used as a dweling) I believe. It is pasture property and actually has a river near the front which is very nice. The property is flat and has been used to grow vegetable crops and corn; including some sod i have heard.
Now this property has been lowered a couple of times which makes me happy, but I am looking to see what steps I should take. I am looking forward to hiring a surveyor but really dont know how much they charge for their services.

In the financing, I would go to a bank for it if they approve me but arent interest rates higher for loans through a bank?

I have soo many questions but to be very honest I dont know what i should do first in geting in to this venture of ours.

Thank you all for the help, i do appreciate your support!

 

[ninny]

Please get a realtor and march right to a bank!!!! Rates are very low right now around 5%. The banks have different programs that they can see if you fit in. Talk to different bankers at different banks see who can do what for you. A good realtor can walk you through everything as will a real estate lawyer. My family has been in real estate for years and i know how badly things can go. Just trying to make sure nothing happens to you.