A farm is a red barn, right? the new farm I purchased in 2017 |
Hi there fellow farmers! I am a little new to the farm real estate scene. I am farming in my current location, but it's really not a viable area for it. After doing a lot of research, the areas that we are interested in DO have farms for sale, but the problem is either
A) They want to sell right away (therefore the possibility of using an FSA Loan, our only option, doesn't work for them)
or
B) There may be someone to work with us, but I have no idea how to find those people because I don't actually know anyone in the area.
It's pretty far away, so just dropping by to get to know people would be really hard but I might be able to make a weekend out of it.
So, dear fellow farmers, what would you do if you needed to move to a different area where you didn't know anyone?
Context: Northern California looking to move to Western Oregon, Western Washington, or possibly Denver-ish if their housing market crashes
I'll be looking for a new tenant for the farm pictured above this summer (current tenant moving to montana) so I asked what sort of farming that they wanted to do. Answer?
Hey that pretty much fits our timeline! We're currently raising Icelandic Sheep, Kunekune pigs, various rare breed chickens. We're small right now because we're restricted but we want to grow as fast as possible, but really want to be 100% grass fed. As long as you have grass we'll be happy.
Nothing that they described really sounded like profit to me, and unfortunately profit is how you pay the rent. So I wrote back:
3br houses rent in this area for $1500-1800/month. utilities are another $150. The 40 acres is in grass right now, produces 500 round bales a year @600lbs each (2-3 cuttings, weather depending). the bales cost me $13 each to produce, sell for $35, so the land nets about $11k/year, or roughly $275 profit per acre per year. so if you wanted a couple of acres you'd have to pay at least that per acre to make it worth my while.
I'm talking about this to you to give you an idea of what the math with be with any farmer landlord. your enterprise would need to produce $1600+150 = 1750 per month to cover the rent, and if you wanted 3 acres, add another (275 * 3 / 12 = ) $70 a month for $1820/month.
have you thought this through to the point where you have a plan to net (after taxes) $3k a month?
I'm talking about this to you to give you an idea of what the math with be with any farmer landlord. your enterprise would need to produce $1600+150 = 1750 per month to cover the rent, and if you wanted 3 acres, add another (275 * 3 / 12 = ) $70 a month for $1820/month.
have you thought this through to the point where you have a plan to net (after taxes) $3k a month?
Think I was too rough on them?