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12/14/11, 05:40 PM
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Join Date: Sep 2010
Location: Williamsburg, Virginia
Posts: 661
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How To Afford More Land?
I just moved to my 4 acre farm three years ago, so still have a lot of mortgage to go...There is nearly 80 acres that will be for sale within 5 or so years adjoining my property that I would really like to get a 10 acre slice of. If I can't get it when it's for sale then, I may never have another oportunity for it in my lifetime (if it gets bought up by the cornfield barons of the area!). I'm determind to make it happen somehow.
Other then just plain old saving & getting the mortgage paid off as quickly as I can, what are my financial options in IL? I'm not in a great place for a big loan yet having fairly recently moved, so I had thought maybe I could lease the land in a lease-to-own situation. I know there are tax breaks out there if you plant acres of trees, if you earn $2,000 or more off your farm - (farm exempt), etc. but feel like I don't know all of my options that could help me out yet.
I would love to hear any advice from those who've done it, or now someone who has!! I know my farrier managed to get 30 more acres, and he's still got really young kids, so I know it's possible...
Last edited by happychick; 12/14/11 at 05:43 PM.
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12/14/11, 06:11 PM
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Moderator
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Join Date: Jul 2004
Location: Mountains of Vermont, Zone 3
Posts: 8,878
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Scrimp.
Don't spend money on other stuff.
Get together with family or friends on it to help you.
Make an offer now and start buying it.
Owner finance.
All these have worked for me.
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SugarMtnFarm.com -- Pastured Pigs, Poultry, Sheep, Dogs and Kids
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12/14/11, 06:22 PM
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Join Date: Aug 2010
Location: W Mo
Posts: 9,275
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Focus on getting a cash offer together. Sell stuff. Cut back expenses. Find more income. Which of the following offers is most likely to be accepted?
1) Will you take X amount for the land? And then wait for weeks while I get a loan approved?
2) Will you take X amount for the land? I can have a cashier's check for you whenever you have the deed ready to record the transfer at the courthouse.
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It is still best to be honest and truthful; to make the most of what we have; to be happy with the simple pleasures and to be cheerful and have courage when things go wrong.
Laura Ingalls Wilder
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12/14/11, 06:32 PM
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Join Date: Dec 2010
Location: Central Oregon
Posts: 6,175
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Just how do you know it will be for sale in 5 years? How do you know they will split (or can legally split it) to sell it?
Increase your income, start saving your money, protect your credit rating.
It is very difficult to get a loan to buy bare land. It will be nothing like getting a loan for a house.
You might go to the owners and see if they want to do a lease with an option to buy on the 10 acres adjacent to you. If you do that, better be sure it gets recorded at the courthouse. If they get foreclosed, you will lose your investment whether the lease is recorded or not, but at least they won't be able to sell it out from under you.
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12/14/11, 06:40 PM
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Join Date: Jan 2011
Location: Eastern Saskatchewan
Posts: 2,971
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Put as many of your current 4 acres to work for you as soon as possible. Raise meat, raise flowers, raise vegetables. Raise something your ground can grow well, and that is in demand. A lot of money can be made on a few acres if one researches markets, and applies themselves, especially in a place like Illinois with a fairly robust population...
Provided you have the time of course. Good luck. It can be tough getting land when leveraged freshly... 
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12/14/11, 06:55 PM
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Join Date: Sep 2010
Location: Williamsburg, Virginia
Posts: 661
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Thanks for the speedy advice folks!
Quote:
Originally Posted by oregon woodsmok
Just how do you know it will be for sale in 5 years? How do you know they will split (or can legally split it) to sell it?
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I know the neighbors fairly well, and for family reasons they will definetely be selling, most likely in the next five years or so.
I do not know for sure if they would divide it up. I have talked to the owner about it (a elderly city lady who doesn't know a thing about her own land letting someone else do all the work on it, plus her mind is 'going')...She didn't want to divide it up, but I'm hoping when the situation arises & they need to move she would consider. It's leased out to farmers, & she didn't even know what she was getting/charging for the leasing. 
*I know prices vary by location, but what a general/approx. price per acre for farm land? This land is flat farm land, had beans & corn on it every year...located in the North West corner of IL...
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12/14/11, 08:04 PM
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Join Date: Jun 2011
Location: se South Dakota
Posts: 1,128
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I know ground is going for $8000 an acre here and thats farm ground
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12/14/11, 08:12 PM
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Join Date: Oct 2006
Location: IA
Posts: 1,631
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I honestly can not imagine an absentee owner (investor) wanting to divide the land into smaller sections unless they feel they can get more $ for the area. If you feel you have some contact with them I would try to figure out something now such as purchase on contract before it goes to auction. What do you plan on doing with the extra land? We had farm land go for $20,000 per acre here not long ago (YES FARM LAND)! Average of recent selling land is now over $10,000 per acre now.
[URL="http://http://www.kcrg.com/news/local/Iowa-Farmland-Sale-Sets-State-Record-at-20000-135320853.html"]
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IOWA
Last edited by treasureacres; 12/14/11 at 08:19 PM.
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12/14/11, 08:43 PM
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Join Date: Sep 2010
Location: Williamsburg, Virginia
Posts: 661
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Quote:
Originally Posted by treasureacres
What do you plan on doing with the extra land?
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I really need a second 2 acre pasture. But I want the rest to make good profit. We have a organic winery 2 miles up the road that we thought of supplying with grapes as they ask anyone who lives in the country around here to grow at least an acre (it pays pretty well too). I have just started a business growing and selling plants/herbs/flowers and have got a hoop house put up...Basically a lot of things. But I still have a lot of learning to do, but want to make the most of the chance while I can.
WOW, $20,000!? Yikes! Most of the time I thought it went for more then $5,000 but less then $10,000?! I guess 1 acre selling for that much is a sure sign that we should get it while we can, I'm sure the prices will only sky rocket as time goes on...
I don't know much about farm auctions, if the land was put up for auction, would go per acre or all together in the huge 80 lot?
Thanks everyone!
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12/14/11, 08:45 PM
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Join Date: Jun 2011
Location: se South Dakota
Posts: 1,128
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80 acres is not huge
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12/14/11, 09:11 PM
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Join Date: Oct 2006
Location: IA
Posts: 1,631
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Quote:
Originally Posted by happychick
I really need a second 2 acre pasture. But I want the rest to make good profit. We have a organic winery 2 miles up the road that we thought of supplying with grapes as they ask anyone who lives in the country around here to grow at least an acre (it pays pretty well too). I have just started a business growing and selling plants/herbs/flowers and have got a hoop house put up...Basically a lot of things. But I still have a lot of learning to do, but want to make the most of the chance while I can.
WOW, $20,000!? Yikes! Most of the time I thought it went for more then $5,000 but less then $10,000?! I guess 1 acre selling for that much is a sure sign that we should get it while we can, I'm sure the prices will only sky rocket as time goes on...
I don't know much about farm auctions, if the land was put up for auction, would go per acre or all together in the huge 80 lot?
Thanks everyone!
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Bidding is price per acre, but usually includes whole parcel of land. Again, not much benefit to split it up unless it would demand a higher return such as real estate lots or commerical property. I am not saying it can not be done, just is very rare anymore with todays market. I think land price may continue to rise, but may also crash when corn goes back to $3. Also, if you let it be known that you are maybe going to be organic anything, be careful who you tell because other farmers may feel threatened by that. We had a small section of land, I believe 15 acres, that was up for sale and a man wanted it for an orchard. Once word got out to the farmer that would be farming beside it, he decided to run the bid up out of reach of the man who just wanted an orchard. He later told everyone he did it because he didn't want to worry about what he was spraying around the orchard.
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IOWA
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12/15/11, 01:55 PM
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Join Date: Apr 2010
Posts: 736
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Don't try to pay off the mortgage early if you want to buy this land. You will need to save the cash for the land.
Offer to buy the section of land and to also pay for the surveyor cost for dividing it up. Find out what the going price is per acre in your area. It is probably cheaper for you in the NW part of IL, than it is for us in the Rockford area...where it is still being bought up by developers to a certain extent.
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12/15/11, 05:05 PM
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Join Date: Dec 2010
Location: Central Oregon
Posts: 6,175
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Land probably isn't going to ever get any cheaper than it is this year. I haven't seen prices like this for 20 years. Farm land will be in more demand as the world population grows and grows and everybody wants to eat.
Financing land is difficult unless the seller will carry paper, which doesn't seem likely in your case. Start a savings account. If you think you can make money with the land you've got, get crackin'.
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12/15/11, 05:27 PM
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Join Date: Sep 2010
Location: Williamsburg, Virginia
Posts: 661
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Quote:
Originally Posted by oregon woodsmok
. If you think you can make money with the land you've got, get crackin'.
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Absolutely!  I'm working on making the 4 acres I have as efficient as possible.
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