Leasing my Land

[dougtrr2]

You mentioned that the ultimate goal is to sell that land and basically the land is not bringing you any enjoyment.

As you are thinking about your selling price, don't forget about your annual expenses. Taxes, maintenance etc. You will continue to pay out money every year for something you really don't want. Add that up over a few years and it might be better to take a bit lower price and move on with you life.

My brother had a business. When he got out of it they had an offer of 200,000 for the land and buildings. That wasn't enough. It was a small town, so the market was limited. After five years they finally agreed to sell it for ..... 200,000. But they had spent 20,000 a year for taxes and maintenance.

Doug in SW IA

 

[airbiscuit]

I have 40 acres that's 65 miles from where I live. ...

My goal for the land is to hold onto it until it's worth stupid money. It's an hour out of the Dallas area, and the area is still very rural, but there is a lot of building going on there. The land has city water and power to it, but it's not turned on at this time. My hope is that it will continue to increase in value, and that would only be better with somebody taking care of the land. I have no interest in going there, or messing with it, it's just an investment that's sitting there.

Another concern is in keeping it Ag with his cattle on it. My taxes are very low because of the cattle that I just sold that were on the land. Keeping it in Ag should be easier with his cows using that land.

Does this make sense? Is $15 an acre fair? I'm not very motivated to make this a big legal issue. I would really just keep it informal and let him do what he wants to the land to make it better to feed his cows. The way it is now, there really isn't any way to make the land worse, the mesquite trees or really bad there, and if he removes some of them, it's a win for me!!!! Just mowing it once or twice a year would be a huge savings for me and an improvement to the land.

I think it's the proximity to Dallas that is a factor in the hold on to it for a while approach.

 

[EddieWalker]

I think it's the proximity to Dallas that is a factor in the hold on to it for a while approach.

That's what I'm thinking. Of course, it could change at any time, so I'm not really set on one thing over another. For the right price, I could see selling this place too. My lifelong dream has always been to live in the Rocky Mountains, but prices there have gotten so out of control, I doubt it will ever happen. I'll just have to wait and see how it all turns out.

 

[paulsharvey]

This cattle lease would reduce his holding costs to near zero. Sure, the property value Could drop, but being so close to a major metro, I think holding the property, and leasing it is probably the "highest and best use". The cattle farmer isn't going to buy what can be leased for $15/year for $10,000 per acre, or even $5,000 per acre; but eventually there will likely be a developer who wants to turn it into 5 acre, semi rural subdivision, and they would likely pay $5000+/acre

 

[paulsharvey]

I still would not rule out short term hunting lease/recreational. Being so close to DFW, I'll bet there is a line of folks ready to drop $500/weekend for duck/turkey/deer/hog hunting, or even special event short term RV spot. Maybe the week of the Cotton Bowl or other major sporting events. Texas motor speedway races, ect. You can probably get $500/week, and i would guess you can have an RV setup because of the existing home. I'm NOT saying 20 RVs, that likely requires permitting, but a single RV for a week, that is probably allowed with no permitting, and only takes up the area directly at the old home/shop site.

 

[EddieWalker]

This cattle lease would reduce his holding costs to near zero. Sure, the property value Could drop, but being so close to a major metro, I think holding the property, and leasing it is probably the "highest and best use". The cattle farmer isn't going to buy what can be leased for $15/year for $10,000 per acre, or even $5,000 per acre; but eventually there will likely be a developer who wants to turn it into 5 acre, semi rural subdivision, and they would likely pay $5000+/acre

$8,000 an acre and more is the listed price for land in the area. I'm sure that the neighbor would want to pay a lot less than that, but I'm also sure that he knows what land is going for there too. My guess is that if he wants it, he knows that it's a long-term investment that will continue to increase if he buys it. But I also wonder if he is more interested in buying it to stop somebody from building more houses there.

Either way, it's not my concern. If Texas continues to grow like it has, flat, easy to build on land and hour from Dallas, on a paved, dead end road with power and city water, should only increase in value.

 

[mike69440]

$8,000 an acre and more is the listed price for land in the area. I'm sure that the neighbor would want to pay a lot less than that, but I'm also sure that he knows what land is going for there too. My guess is that if he wants it, he knows that it's a long-term investment that will continue to increase if he buys it. But I also wonder if he is more interested in buying it to stop somebody from building more houses there.

Either way, it's not my concern. If Texas continues to grow like it has, flat, easy to build on land and hour from Dallas, on a paved, dead end road with power and city water, should only increase in value.

Short term Legal binding lease, but unless yearly expense of keeping the land is too much to handle, Don't sell just yet is what my thinking is.

 

[ultrarunner]

For years my uncle turned down offers in the 800 to million for a commercial Oakland property.

Last year his health started declining and he said ok... sell.

I contacted 7 that expressed interest over the last 6 years and all politely declined at any price.

The Oakland commercial market is down 60 to 80 percent and city regulations make hold vacant property very expensive.

Will it turn... probably... but in who's lifetime?

 

[bigtiller]

Something to think about.

$8000 times 40 acres invested in the market could return in the neighborhood of $20,000 per year.

 

[EddieWalker]

I brought that up in another thread about investing under the new President. I’m wondering if land prices will shoot up because the housing will take off, or will the Market take off due to an Administration that is pro business? So far it’s just a lot of guessing. And in this case, doing nothing seems to be the best option