mike22nc Posted April 25, 2019 Posted April 25, 2019 Hello everyone, I have been a member of these forums since the early 2000s and have always enjoyed the content without participating much at all. I believe this is the first time I've ever posted in OTW. With that, I am looking for advice from some fellow Bills fans on a farm land purchase I am looking to make. My wife and I moved to Niagara County a little over a year ago. The home we purchased is on 1.2 acres with 14 acres of farm land directly behind us and the neighbors, which is owned by those neighbors. They are moving soon and we've made them aware that we are interested in purchasing the land. Here is the question - How would you go about valuing land that does not have access or frontage? I have tried to do as much research as I can, but I have been unable to find comps to this specific situation. Lots specifically for building homes are plentiful, but would not be comparable. I really don't know if the value should be 2k per acre or 10k per acre. Anyone have experience or knowledge in this area? Thanks for the years of entertainment in here!
The Senator Posted April 25, 2019 Posted April 25, 2019 My first inclination is, buy it all. Unless it’s on top of a toxic waste dump, land doesn't depreciate, ever. What would you do with that acreage? Do you want the land, or the profit? Would you attempt to sub-divide? Are there zoning ordinances about lot size? (You’ve stated that there’s no access, so your best hope for that would be a developer that would build roads, extend utilities, etc., and then you’d have quite a few close neighbors.) Or would you simply purchase the land to ensure your own privacy and enjoyment? (I would.) Lots to consider, but I’d buy the land now and consider it later, while the value appreciates. But you know much more about your locality than I do. JMO. . 3
mike22nc Posted April 25, 2019 Author Posted April 25, 2019 (edited) We'd be purchasing to enjoy the land ourselves. No exact plan yet, but we'd extend our backyard another .5 acres or so, plant some fruit and/or nut trees and likely lease out the rest to a local farmer to cover some of the taxes. The purchase would MOSTLY be to, as you say, ensure our own privacy and enjoyment. Edited April 25, 2019 by mike22nc
The Senator Posted April 25, 2019 Posted April 25, 2019 5 minutes ago, mike22nc said: We'd be purchasing to enjoy the land ourselves. No exact plan yet, but we'd extend our backyard another .5 acres or so, plant some fruit and/or nut trees and likely lease out the rest to a local farmer to cover some of the taxes. The purchase would MOSTLY be to, as you say, ensure our own privacy and enjoyment. Good plan. You can’t, and won’t lose. You’ll enjoy total privacy, save for the deer eating your low hanging branches and windfall fruit, and create a wonderful property for your family. (Five acres might even be enough for a small vineyard!) Best of luck! ? .
sherpa Posted April 25, 2019 Posted April 25, 2019 Many considerations. First, you say it has no access or frontage. I assume you mean by road. That means that if anyone was to build on it, they would require an easement, which is a huge negative. What about zoning? Is it possible to develop? Of so, how many units/lot size requirements? You may plan to use it for your enjoyment, but such a consideration impacts value considerably. If used strictly for farming, what is the tree situation? How about grade/slope/drainage/soil condition issues? What local crops are grown successfully, and what is a reasonable price to expect? When those questions are answered, I would start at looking at local farmland sales, if there are any, and I'd look at what the owner paid and subtract a reasonable amount for the house, adjust for time of ownership, and come up with a starting offer. If you plan on doing some kind of agriculture on it yourself, spend the necessary time researching the amount of work that takes based on the specific crop, the equipment you'll need, if aggressive preventive spraying is needed and the tax consequences. Some localities will provide a significant tax break if the land is in agricultural use but may require an income producing crop to justify it. I own 30 acres in wine country here, so I have run a commercial vineyard for twelve years. It is extremely labor intensive from March through mid Sep. Much more than I thought when I constructed it, and doing things at specific times is not an option. The county requires proof of sales to justify my tax credit, and the credit is significant. If you are doing some agriculture on it, refi options are greatly limited since 2008. Anyway, lots to consider. Good luck.
mike22nc Posted April 25, 2019 Author Posted April 25, 2019 32 minutes ago, sherpa said: Many considerations. First, you say it has no access or frontage. I assume you mean by road. That means that if anyone was to build on it, they would require an easement, which is a huge negative. What about zoning? Is it possible to develop? Of so, how many units/lot size requirements? You may plan to use it for your enjoyment, but such a consideration impacts value considerably. If used strictly for farming, what is the tree situation? How about grade/slope/drainage/soil condition issues? What local crops are grown successfully, and what is a reasonable price to expect? When those questions are answered, I would start at looking at local farmland sales, if there are any, and I'd look at what the owner paid and subtract a reasonable amount for the house, adjust for time of ownership, and come up with a starting offer. If you plan on doing some kind of agriculture on it yourself, spend the necessary time researching the amount of work that takes based on the specific crop, the equipment you'll need, if aggressive preventive spraying is needed and the tax consequences. Some localities will provide a significant tax break if the land is in agricultural use but may require an income producing crop to justify it. I own 30 acres in wine country here, so I have run a commercial vineyard for twelve years. It is extremely labor intensive from March through mid Sep. Much more than I thought when I constructed it, and doing things at specific times is not an option. The county requires proof of sales to justify my tax credit, and the credit is significant. If you are doing some agriculture on it, refi options are greatly limited since 2008. Anyway, lots to consider. Good luck. Correct, no access by road. The land is bordered by our yard and our neighbors yard on the south side, another larger farm on the east side, my other neighbors land on the west side and wooded land on the north side. It is zoned residential/agricultural. I do not believe that it is possible to develop. It is currently used for farming, it was leased out to a farmer who planted soy beans this past summer. There are no trees on the land, it is all tilled soil. I have been in the field, but I do not know enough to answer the questions about grade/slope/drainage/soil. As far as what the owner paid, I am unsure. They have owned the land since the 70s. The tax assessment appears to show a value of around $28,000, but I doubt that has much validity either way. My main issue is that the unique situation where the land is pretty much inaccessible to anyone other than the 5 abutting properties is what makes looking for comps very difficult. If you are in wine country we may not be very far from you! Thanks for your response, definitely gives me some info to think about.
Alaska Darin Posted April 25, 2019 Posted April 25, 2019 Talk to a local real estate agent. They can ballpark it easily enough. 3
SlimShady'sSpaceForce Posted April 25, 2019 Posted April 25, 2019 5 hours ago, mike22nc said: We'd be purchasing to enjoy the land ourselves. No exact plan yet, but we'd extend our backyard another .5 acres or so, plant some fruit and/or nut trees and likely lease out the rest to a local farmer to cover some of the taxes. The purchase would MOSTLY be to, as you say, ensure our own privacy and enjoyment. If you don't buy it someone else will and you won't have any choice in how or when they sell it to a developer. I'm pretty sure you can get land value estimates from the town / county 3 hours ago, mike22nc said: Correct, no access by road. The land is bordered by our yard and our neighbors yard on the south side, That has never stopped a developer before. 1
teef Posted April 25, 2019 Posted April 25, 2019 1 hour ago, Alaska Darin said: Talk to a local real estate agent. They can ballpark it easily enough. this was my first thought. you may need advice from an attorney as well. weird ***** can pop up when you buy land. a few years ago i bought a couple of acres for future plans. what a mess. it took almost a year and tons of attorney fees to push it through. it was part of a trust, and they had a shocking about of trouble hammering out the specifics. after the purchase went thought, and it was being evaluated for a project, i was lucky to find out that it was, "archaeologically sensitive" land. yup. it was in the ballpark of native american land, and it had to go through a stage 1 evaluation to make sure no specific signs inhabitation were present. fortunately nothing was found, and we could move forward. that being said, buy as much as you can. I had an opportunity to buy another 8 acres behind it, and after all of the trouble i decided not to. i wish i had.
RochesterRob Posted April 25, 2019 Posted April 25, 2019 7 hours ago, mike22nc said: Hello everyone, I have been a member of these forums since the early 2000s and have always enjoyed the content without participating much at all. I believe this is the first time I've ever posted in OTW. With that, I am looking for advice from some fellow Bills fans on a farm land purchase I am looking to make. My wife and I moved to Niagara County a little over a year ago. The home we purchased is on 1.2 acres with 14 acres of farm land directly behind us and the neighbors, which is owned by those neighbors. They are moving soon and we've made them aware that we are interested in purchasing the land. Here is the question - How would you go about valuing land that does not have access or frontage? I have tried to do as much research as I can, but I have been unable to find comps to this specific situation. Lots specifically for building homes are plentiful, but would not be comparable. I really don't know if the value should be 2k per acre or 10k per acre. Anyone have experience or knowledge in this area? Thanks for the years of entertainment in here! There are ways to look up past sales on line and avoid the realtor. Many print newspapers on a periodic basis publish deed transfer information including buyer, seller, and price. You are allowed access to records concerning transfers at your county office building. Where I am going is the more parties that know the situation the more the chances you will get scooped by someone else. The Realtor that you innocently ask prices from could go to the current owner to see if they would sell their home and land at the same time. I go on a rural themed site daily and nearly daily I see somebody with some tale of woe as to how a land purchase did not come off as planned. I don't know Niagara County but in many areas around Rochester farmland is easily 5,000 dollars per acre or more. You said there is a neighboring farm that works that tract of land. Why don't they want it? It would lend a clue as to true value if wet with no outlet for drainage for example. Be dilligent but do not be desperate.
BringBackFergy Posted April 25, 2019 Posted April 25, 2019 The parcel is landlocked? So if it's landlocked you (and your neighbors) kind of have the owner over a barrel (meaning - he can't sell it to a third party/non-bordering buyer because neither you or any of your neighbors will grant an easement to a stranger). That being said, your ability to purchase the parcel is only as good as your neighbors' ability to buy it. I would think the farmer that borders this land will want to buy it as well. So now you're in a bidding war with a farmer who desires the land more than you. A possible way to address this problem is to go talk to the farmer and see if you guys can split it down the middle (he takes 7 acres bordering his farm and you buy the other 7 acres bordering your lot). The owner has to sell to either of you because h can't sell to a non-bordering third party (no other access to the parcel). Just don't be surprised if the farmer can out-bid you because the land is more valuable to him than to you. Just my two cents.
RochesterRob Posted April 25, 2019 Posted April 25, 2019 3 minutes ago, BringBackFergy said: The parcel is landlocked? So if it's landlocked you (and your neighbors) kind of have the owner over a barrel (meaning - he can't sell it to a third party/non-bordering buyer because neither you or any of your neighbors will grant an easement to a stranger). That being said, your ability to purchase the parcel is only as good as your neighbors' ability to buy it. I would think the farmer that borders this land will want to buy it as well. So now you're in a bidding war with a farmer who desires the land more than you. A possible way to address this problem is to go talk to the farmer and see if you guys can split it down the middle (he takes 7 acres bordering his farm and you buy the other 7 acres bordering your lot). The owner has to sell to either of you because h can't sell to a non-bordering third party (no other access to the parcel). Just don't be surprised if the farmer can out-bid you because the land is more valuable to him than to you. Just my two cents. I agree with a lot of what you said. What I will say that if the lot that the home sits on is wide enough the owner can sell a a 20 feet wide strip off then have legal access. If the farmer wants it bad enough he may buy lock, stock, and barrel and put in an access if desired and possible given the home lot's dimensions. The OP should not assume he has this firmly in his grasp because of current circumstances. 1
Nanker Posted April 25, 2019 Posted April 25, 2019 2 hours ago, ShadyBillsFan said: If you don't buy it someone else will and you won't have any choice in how or when they sell it to a developer. I'm pretty sure you can get land value estimates from the town / county That has never stopped a developer before. ^This. A developer could buy it and your neighbor's house and then raze that house and put in a road to the back acreage. Your beautiful back yard would have a perfect view of that new housing development. Also, contact a realtor in the area that deals in farmland. They'll appraise it. Your neighbors will be doing that if they haven't already. 2
Just Jack Posted April 25, 2019 Posted April 25, 2019 If you don't mind your money being tied up for a while, do what my parents did with their current house, which they bought in the 1970's. It had been a farm with a lot of acreage. A landowner in the area bought the entire thing (he leases out his land to farmers) and told my parents they could buy 4 acres of the land from him, as long as all 4 acres encompassed all the existing buildings. (House, two barns, milk house, smoke house, chicken coup) They went with the basic 2x2 shape for their portion of the land. You could do the same, buy it all, then split off the house and any buildings and sell it as a separate parcel. 1
KD in CA Posted April 25, 2019 Posted April 25, 2019 9 hours ago, mike22nc said: Hello everyone, I have been a member of these forums since the early 2000s and have always enjoyed the content without participating much at all. I believe this is the first time I've ever posted in OTW. With that, I am looking for advice from some fellow Bills fans on a farm land purchase I am looking to make. My wife and I moved to Niagara County a little over a year ago. The home we purchased is on 1.2 acres with 14 acres of farm land directly behind us and the neighbors, which is owned by those neighbors. They are moving soon and we've made them aware that we are interested in purchasing the land. Here is the question - How would you go about valuing land that does not have access or frontage? I have tried to do as much research as I can, but I have been unable to find comps to this specific situation. Lots specifically for building homes are plentiful, but would not be comparable. I really don't know if the value should be 2k per acre or 10k per acre. Anyone have experience or knowledge in this area? Thanks for the years of entertainment in here! There's an app (and URL) for that..... www.acrevalue.com
RochesterRob Posted April 25, 2019 Posted April 25, 2019 12 minutes ago, KD in CA said: There's an app (and URL) for that..... www.acrevalue.com Acrevalue gives you raw data and not much else. A would be buyer still needs to evaluate information in order to know if pertinent to his situation. It takes far more effort to be your own researcher but you don't have to look at bias in other sources. Plus your efforts stay private. Let other parties into the mix and they might pull the prize away from you. Who else does the OP's nearest realtor work with and is that realtor paid to bring in hot tips for that party? Would not be the first time that a realtor was in fact working for a preferred client instead of the guy making an inquiry.
SlimShady'sSpaceForce Posted April 25, 2019 Posted April 25, 2019 37 minutes ago, Nanker said: ^This. A developer could buy it and your neighbor's house and then raze that house and put in a road to the back acreage. Your beautiful back yard would have a perfect view of that new housing development. Also, contact a realtor in the area that deals in farmland. They'll appraise it. Your neighbors will be doing that if they haven't already. Nearly every patch of land in my little town, from 2 acres to 50 acres is being bought up and houses being built on them. They will find a way to build a road.
RochesterRob Posted April 25, 2019 Posted April 25, 2019 7 minutes ago, ShadyBillsFan said: Nearly every patch of land in my little town, from 2 acres to 50 acres is being bought up and houses being built on them. They will find a way to build a road. A developer will buy the house and tear it down if necessary to have access. They would buy the house and tear it down if it does not fit the neighborhood in terms of value (i.e high value homes).
KD in CA Posted April 25, 2019 Posted April 25, 2019 17 minutes ago, RochesterRob said: Acrevalue gives you raw data and not much else. A would be buyer still needs to evaluate information in order to know if pertinent to his situation. It takes far more effort to be your own researcher but you don't have to look at bias in other sources. Plus your efforts stay private. Let other parties into the mix and they might pull the prize away from you. Who else does the OP's nearest realtor work with and is that realtor paid to bring in hot tips for that party? Would not be the first time that a realtor was in fact working for a preferred client instead of the guy making an inquiry. Well sure, that's what you're paying for -- having pertinent data on your screen instead of trying to piece it together from lots of disparate sources. Bias and privacy come into play with local realtors; hence the value of getting the data yourself easily and in a useable format.
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