Homesteading on High Priced Land?

Discussion in 'Homesteading Questions' started by Obser, Jun 7, 2006.

  1. Obser

    Obser "Mobile Homesteaders"

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    In many threads there is discussion of homesteading on very expensive land. Figures of many thousands of dollars per acre, or properties costing hundreds of thousands of dollars are mentioned. In one recent example $100,000 per acre for five acres was discussed.

    There must be something I do not understand -- very sincerely. Will someone set me straight?

    I cannot comprehend land priced at $100,000 per acre X 5 acres being considered for homesteading or farming -- or even land for $10,000 per acre.

    Whether land is purchased outright or financed there is an interest consideration -- either interest paid or interest lost. If one pays cash the money is locked up in land and cannot draw interest. If the land is mortgaged the interest will accrue.

    Either way it is money gone. At five percent (paid or lost) on $500,000 that would amount to $25,000 per year – which is the base cost of living on the expensive land ($2000 per month).

    Also, taxes are usually somewhat proportional to land value, and are typically too high to out-of-sight. Buildings are often not mentioned, so their cost must evidently be additional. All other start up costs of developing a homestead must come from somewhere.

    If one purchased land for a fraction of the amounts mentioned (as can be done in many areas) and kept their cash, they could create a wonderful homesteading / semi-self-sufficient lifestyle with a half million dollars and have enough reserves to live on for many years little or no outside income.

    If the purpose of staying in a high priced area is to keep a high paying job, the job simply pays for an expensive place to live – and the job probably at least discourages doing much homesteading or farming. What happens AJ – after job?

    I’m shaking my head over this quandary. At $1,000 per acre most land would do well to provide a break-even (unless cropped intensively for a specialty market). At a hundred times that land price, it doesn’t seem to compute.

    Again, I am not criticizing anyone or being disrespectful or sarcastic. I simply do not understand how high-priced land can be consistent with homesteading – and would appreciate clarifying comments.
     
  2. pcdreams

    pcdreams Well-Known Member

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    don't feel bad Obser.. I can't imagine paying this much for land either... Heck even 2k an acre is really pushing it (for us anyway).. I've seen land as high as you're talking but not anywhere I'd want to live :)

    But then again I think a lot of folks are in love with the IDEA of homesteading and not the Reality (or actual interest in getting into the work of it)..

    I'm not slighting anyone for their choices.. Just hard to make sense of how some folks think/act.. etc
     

  3. turtlehead

    turtlehead Well-Known Member

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    Obser, I think the same could be said of non-homesteaders. In the end, it boils down to what a person chooses to do with their income.

    Some people analyze the paid interest or loss of earned interest on all that money and decide that high priced land makes no sense for them.

    Others find the location justifies the expense. It's a personal decision, of course, like deciding how much you're willing to pay for a pair of shoes.

    I don't see that paying 100K or 10K or 1K per acre fits with the homesteading lifestyle or not, provided one has the funds. I DO think that the more expensive properties are more likely to have restrictions that would prohibit raising of livestock and even fencing and gardening. THAT would impact a homesteading lifestyle.

    It's true that typically homesteading is an exercise in frugality but there's nothing that says Bill Gates couldn't decide to buy some acreage at an exorbitant price, build lovely air-conditioned and heated out buildings, stock his ponds, buy fine pedigreed stock, and follow a lifestyle of raising his own food, learning to sew, and otherwise providing for his own needs himself to the extent he is capable.

    It sorta paints an amusing picture, doesn't it?
     
  4. mpillow

    mpillow Well-Known Member Supporter

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    $100,000 would buy my house 5 acres and outbuildings almost!

    In Northern Maine its not unheard of for 3-500$ an acre for large tracts...but no economy and too far out of the way to market farm products...we are looking for a hayfield and hunting property in that area/price but we HAVE to live in Central Maine because its close to work :shrug:

    We did recently pay $1000 an acre w/ stream frontage and mountain views in western Maine...30 acres of privacy
     
  5. Obser

    Obser "Mobile Homesteaders"

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    Wonderful Wife and I might be willing to help the struggling Mr. Gates make his homesteading dreams into reality. Of course, that we would not very likely do gratis.
     
  6. Lisa in WA

    Lisa in WA Well-Known Member Supporter

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    I think it's all relative. What is expensive to one person may not be to another. People stay in regions for other reasons than jobs. Family, health reasons, or just love of a certain area might make someone pay more for their land. Our land would be considered by some to be high priced, but it's on the water, it's in the area we desired, and it was a very good investment should we choose to sell it. We live off the grid, homeschool, and raise much of our own food. My husband works at a job that he enjoys and pays the bills. It may not be "homesteading" that we're doing, but I don't give a rip. We're living a life most dream about.
     
  7. Cabin Fever

    Cabin Fever Life NRA Member since 1976 Supporter

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    If I was given $500K and was told that I had to invest it in land or the stock market, I would pick the land. Both options "tie up your money" and you'll have to pay taxes on both. At least with the land it's something you can use while you let it appreciate in value.
     
  8. Obser

    Obser "Mobile Homesteaders"

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    Cabin Fever, I'd agree with your choice given that I had to choose between only those two options -- land or stock market. If it were my own money or if it came without restrictions, I might consider other options.
     
  9. mayfair

    mayfair a yard full of chickens

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    Part of the problem is jobs- land is expensive near most places that have good economies. If someone loves an area, has a well-paying, enjoyable job that would be hard to replace, I can see shelling out for the land.

    That said, I doubt I could personally buy expensive land like that. Although I reserve the right to change my mind because that is what land costs here.
     
  10. Westwood

    Westwood Well-Known Member

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    Hi Obser and wife! Sorry we haven't been in touch in a week but it's been hell at work and we're beat when we get home.

    I agree. Can't imagine expensive land like that. Here, 8 miles from the Buffalo River I bought this place for about $850 an acre. From what I hear, it's now about $2,000 an acre. Just north of where you are, closer to Bull Shoals lake, it's more like $4,500 an acre. We drive 50 miles a day, up past you, but it's worth it to us to be near our beloved Buffalo National River.
     
  11. MTNwomanAR

    MTNwomanAR Well-Known Member

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    Westwood, I too, live way out...course, I don't drive 50 miles, just 35... :rolleyes: and sometimes THAT isn't far enough away from the idiots that visit town....................I paid 650 and acre 11 years ago...and to ME, THAT Is a LOT of money..no way would I see paying 1000 or more an acre....it just [to me] doesn't fit with most of what I see is homesteading. Yes, Bill Gates could do that land/homesteading thing....but it is doubtful that he'd find it as interesting as counting his green.................now, if I had more money, I'd buy more land, as they aren't making any more of it, ya know................. :)
     
  12. jcarroll42

    jcarroll42 New Member

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    Hi All,



    Like many people here (I think) my wife and I decided to stay in the city while figuring out our goals and starting our family.

    In our case, the real estate values in our city have been such that we'll probably leave here with several hundred thousand dollars in "play" money. I say "play" because money from real estate is always somehow fake. Really, your primary home is not an investment, it's where you live. If you happen to live in the city it's small, if you live a litte farther out, it can be a bit larger. If you decide to forego the 'benefits' that come with being near a large metropolitan area, you have a huge chunk of 'play money'.

    I'm not sure I understand the implication of "real" homesteading. To me, this seems a bit like my junior high school where certain friends of mine would decide who was "really" punck rock.


    To me, you either want to live closer to your land or not. Most people don't think about this enough to care. My wife and I do, but have been 'lucky' enough to live in a city which has experienced explosive real estate valuations. So we could either invest the profits from this in something stupid, or buy a piece of property near our family and live close to our land. Except - this might not be "real" homesteading - so we should probably voluntarily suffer and prove how much we care.



    Sorry for the sarcasm, but I found this post a little insulting.



    - Jeff
     
  13. jnap31

    jnap31 garden guy

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    I cant see paying more than 1k an acre or so for homestead land either here in the USA obser1. Li8ke soem one pointed out the land that is cheapest is often the land that has no restrictions and of course less taxes and so would allow people to live more of the ideal self sufficient homesteading life. That is what I was hoping to find, some raw land to make a little farm on when I get home for about 1k an acre an hour or a little further east of fayetteville any closer and it is to expensive. Though of course if things went bad enough with our governments orweillian control system in development, I would pay what ever the going rate is in another safer country.
     
  14. homebirtha

    homebirtha Well-Known Member

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    If everyone's world were so neat and simple, that would probably all be true. But there are, at least for most of us, many other considerations then just paying the least for the land. For us, we have family in the area, and although R.E. prices are on the high side, this is where we wanted to be, near our families. Another consideration for us was markets. Sure, we could sell this place, pay cash for 40 acres in the Ozarks, or northern Maine (maybe?). But who there would pay $2.50 or $3.00 a pound for our chickens and turkeys? Would there be a market for $2.50 per dozen eggs? Or $6 per 1/2 gallon milk? Would there be a market for any of this stuff at any price? I know a lot of people on here talk about having to give their eggs away because there is no market for them where they live. Would there be any good jobs in the area or would they be mostly minimum-wage at best. Then we'd have to figure in travel expenses to get back here to visit our families that we moved away from as well.

    So, I understand the point you're trying to make, but everyone has different priorities in their life. And money isn't #1 with us.
     
  15. jnap31

    jnap31 garden guy

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    There is a thriving farmers market in Fayetteville Arkansas and others in the Ozarks to sell meat and farm fresh produce at for premium prices though maybe not as hight as you get in Maryland I guess you need to be able to sell lots of produce for those amounts to be able to pay property taxes in lots of those north east states.
     
  16. Aintlifegrand

    Aintlifegrand Well-Known Member

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    I guess I don't really understand Homesteading like I thought I did then. To me: Homesteading is where you live, where you raise your family, your food, your animals. It is doing the one thing you love the most...it is a feeling of completness. It has absolutely nothing to do with the price of the land.
     
  17. Salmonberry

    Salmonberry Registered Nut

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    I agree with the posts that consider this to be a little exclusive. We can't even agree on a working definition of "homesteading." There are many degrees to this concept. I respect ANYONE who attempts to live life more simply, or wants to make some attempt to "get back to the land."

    I will probably never live up to your idea of a "homesteader," even though we live a long way from town, off grid, are in the process of building our own home without septic or plumbing, are raising our own poultry and rabbits and have a large garden to feed ourselves and offset some animal feed. I grind my wheat for bread and I do dishes without a dishwasher. I know, though, that that will NEVER BE ENOUGH for some people. It is, however, as close as I will get to actually being a "homesteader." I don't care if I ever achieve that label.

    Salmonberry
     
  18. bostonlesley

    bostonlesley Guest

    I have friends who have paid $50K an ACRE (yes you read correctly) for land in Eastern PA..Lancaster County..now why did they do that? They could have bought tons of great land elsewhere certainly..no doubt.. and kept about $325K in their pockets, be financially secure for the next 30+ years, etc. etc. etc. Are they "nuts" or what? I choose "or what"..

    Their roots are in Lancaster County PA and have been for 7 generations. All of their family and friends are there. That is where they choose to live and to someday die..to be buried in the same cemetary which holds the earthly remains of great-great grandparents..To be able to take their grandchildren's hands and say "Look here..this is the tree where Grandma and I had a picnic one day and I proposed to her."

    Their entire HUGE extended family gathers together often for birthdays, weddings, funerals..it's quite something to see. You just cannot put a price tag on it.
    For someone such as myself who has had a virtual gypsy life and a family scattered to the 4 winds, I am in awe of them.
    They certainly are "homesteaders" in every sense of the word..
     
  19. jnap31

    jnap31 garden guy

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  20. emulkahi1

    emulkahi1 Well-Known Member

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    Obser--

    It would be my guess that, in this day and age, if someone asked 100 individuals how they defined the "homesteading" lifestyle, one would probably get almost as many different answers. I think technically, a "homesteader" is a person that settles and cultivates land. That definition does not involve an individual's (or family's) frugality, additional jobs (in addition to the cultivation of the land, that is), original cost of the land, or any of that.

    It is true that other's might not live up to my own extrapolation of the word "homesteading". But then, it is just as likely that my choices are inconsistent with THEIR definition of the same word.

    Who is to judge who is more right?

    As for why people might make the choice to "homestead" in an area where land prices are significantly higher....Well, I agree with those that have said that, for many people, there are many other contributing factors (besides just the per acre cost of land) for choosing a particular area to "homestead". Proximity to family is a often a significant consideration, as is the desire to live in a particular area. For example, Jim and I would love to live in Seward, AK. But land is very expensive there. It is true that there are many areas here in central MT where we could have (much) more acreage for less money...but then we would be trading a dry, arid, windy and (relatively) flat environment for Seward's lush, mountainous, ocean-front location.

    Is the trade-off worth it? Well, only those that will be living in the particular area, and paying the bills can answer that question. It might not be worth it to you. But, that does not mean it wouldn't be to someone else. And, of course, their reasons for making their choices are as valid as your reasons for making your own life choices...or mine for my own life, etc.

    Anyway, just my own two cents :).

    Erin