Leasing my Land

[ultrarunner]

My guess is Eddie already has a policy on the place?

As long as both parties are honorable and in agreement it's a win/win.

My grandfather says the purpose of a written agreement is because things can change... one party might die and overnight you are dealing with strangers you have never met.

A one page agreement should cover all the essentials...

What is being leased and for how much and how long and responsible party for repairs and spell out access along with any restrictions such as hunting or who can be on the property.

Someone my brother knows leased land for grazing and all was well until the rancher had a stroke and his daughter replaced the cows with horses...

 

[kthompson]

We are on the other end as landowners. We could sell today probably our farmland for developers. We are doing our best to save the family farmland. Now it looks like we will have a major issue with a proposed new road.

As you have been told verify how that $15 is calculated. I agree you are better off on lower rent price to a person who will take care of it than higher price to a person who does not. Now how much the fencing is going to be worth in selling the land for development it "might" be a negative depending on the type of fence and it will need to be removed and how much that would cost. The buyer will take than into cost of developing it. I could see the cost to remove being as much or more than the installation cost.

Yes, you want a lease. Yes, you want YOU OWN liability insurance and require the renter to have his own liability with you named under the coverage. With him keeping it ranching doubt the taxes would be affected as the use of the land normally sets the tax rate and not who is running the cattle on it.

I expect a long-term lease for him would be better with the cost of fencing and such. Yes, you do not have to have a lawyer to write it but depending on all the details it might be best to hire one to write the lease.

Being an hour away from Dallas to me in Texas is not far to travel. I would talk with real estate agents, or developers NOW and find out what it could be sold for. You might be better off to sell now, take that money and invest in stocks or whatever suits you rather than low-income level for several years waiting on the demand to make up the investment growth.

 

[kthompson]

Just reading the thread on age and such. One tells about his renting a campground in the woods. Depending on your land, what it offers and being large enough to build one you might find it a great property for a campground. If you want to sell.

We are about 25 miles from Myrtle Beach. Campgrounds are very popular there but land is not available. In the last 6 years two large campgrounds have been built several miles from the ocean and look to be doing a very strong business. The roads will have big influence on the location.

 

[garry1p]

I would think renting for grazing as opposed for farming would be less $$. I have about 40 acres leased for farming and they report all their cost to the Government so I have to pay taxes on the income. Rent is $26 acre annually.
I recently had to pay a little over $1000 for a new culvert, they installed it at no cost.
TX may be +/- the rental in MS. I am happy with whatever $$ since I can not work the land.

 

[ultrarunner]

At one time Eddie ran the pluses and minuses of operating a campground and decided against.

As to liability I my agreement requires I be added as a co insured on the renters business policy... it has worked well and twice when there were issues the carrier notified me so I was still covered during the time I aced my own coverage.

 

[jyoutz]

I would think renting for grazing as opposed for farming would be less $$. I have about 40 acres leased for farming and they report all their cost to the Government so I have to pay taxes on the income. Rent is $26 acre annually.
I recently had to pay a little over $1000 for a new culvert, they installed it at no cost.
TX may be +/- the rental in MS. I am happy with whatever $$ since I can not work the land.

Typically grazing leases are based on the number of animals, not acres. But of course they are connected because X acres can support X animals for X amount of time. Yes, crop farming leases is more lucrative than grazing, but it sound like this land isn’t suitable farmland.

 

[mjonesnh]

Not sure about pasture land but in my area farmland leased for grain production is running $100/acre and up. Just depends on how well the land produces. Some farms hit 200 bushel /acre of corn this year, and do 180-190 regularly. Owners have no trouble getting top dollar for their acreage.

 

[Lastkidpicked]

Any negative to removing an existing structure?

There may be one negative. (Or one positive to keeping the house)

Our neighbors have a house on their land that is not livable. They are keeping it anyway because of the grandfathering clause.

If they tore it down, and then decided later to build, then the utilities, water line, and septic would need to be upgraded to the newer and more stringent building codes.

But they could "remodel' the existing structure at any time and be free of the more expensive requirements of the upgraded codes.

This may not matter if you plan to sell to a developer, but it's something to keep in mind.

 

[oosik]

OR you could look at it this way. He is looking after your land. He will make improvements - even if minor. His cows on your land keep the taxes low. And - between the cows and his occasional mowing - the wildfire danger is reduced.

My neighbor to the south, ranges his cows on about 3/4 of my 80 acres. I charge him - zero. The cows keep the grass chewed down and being on my land - it remains classed as AG land for tax purposes. We both win.

 

[dougtrr2]

I would write up a simple lease, but I think you need to address the use of the buildings in that lease. What if he decides to use a building for storage and junks all of your stuff?

Doug in SW IA