Buying a Ranch? Here’s How to Get Your Money’s Worth.

It’s true. Buying a ranch is a different matter altogether from buying a home. Ranches are considered investment property where you store and grow your money. Of course, you can retire there, raise some cattle for sustenance or business, it’s up to you. What’s important is you take into account various matters before acquiring and keeping one.

If you’ve been wanting to realize a lifelong dream to head West and raise sheep, goats and cows, pay attention to the following points.

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Ranch Values

Ranches are valued differently from homes, some don’t even have comparable listings to begin with. Because ranches have been used to produce beef and other food products whose prices are increasing, one pays a premium for these tracts of lands.

We are talking of millions of dollars for thousands of acres. These are factors that influence a ranch’s selling price:

  • Location
  • Access
  • River frontage
  • Improvements to the property
  • Acreage

As there is no ideal home, there is no perfect ranch property either. It all depends on what you’re looking for, how you intend to use the property, and how much you are willing to spend.

You can expect the value of your ranch land to increase, but you would need to take into account maintenance costs and improvements on the property.

Form Connections

In matters like this, consult an experienced ranch broker to help you with the property shopping. If you are financing the purchase, speak with lenders, their loan officers, or independent brokers. This way you can find the mortgage that is well suited for this endeavor.

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It’s important to form relationships with experienced ranchers who can provide practical advice in choosing your property and even the livestock. Understand the trade and its complexities, learn and upgrade your knowledge, and keep these professionals by your side.

Tax Matters

Owning a ranch has its tax benefits. You can defer paying capital gains until such time as you have disposed of the property. You can also claim deductions for business expense, that is if you’re trying to generate profit for it for three years or so. If you choose to be a hobbyist farmer, you still can seek tax deductions but these may be limited and have to be itemized.

Financing Works

Ranches are expensive but they are financeable and accessible to anyone qualified. They are a variety of ranch land loans for individuals who want to pursue a career in the ranching business.

First are loans offered by the Farm Service Agency (FSA) of the U.S. Department of Agriculture (USDA). These government-backed loans help out beginner farmers and ranchers with their farm land purchase and operating costs.

Then, there are loans privately funded by commercial banks. You can approach these lenders for loans that are designed for ranchers and farmers. Don’t forget to shop and compare rates.

Your journey toward ranch financing begins today. »