At what price would you sell out!

[SASKFARMER3]

Talk around town is one very nice farm has just
sold. 8 quarters yard old house. Very nice land in
one block. 2760 an acre. Is this the new norm or
is it insanity at its finest.
But as the numbers get higher is it time to say
f$&k it and quit.
Or stick with ones long term goal.
Our area is totally gone nuts, every one is
guessing what each guy will do. Rent is now 75 to
where 100 next.
So the question I put out their is at what price
would you sell a farm.

[freewheat]

Well, it is insanity at its finest. How
does that pencil out? Seriously? If
someone offered me 2700 an acre, I would
quit without a doubt, maybe save the
home quarter to play with.

WHo the heck is so nuts to pay that
much? What is their pencil made out of?
Gold? Just retarded, so retarded. Good
if it came to our are, but we aint even
close to half of that. More like 1/4 of
that.

If someone can show me the pencilling
and paying for it with NORMAL crops, I
am all ears.

[oliver990]

sf3 are the new owners farm operations actually farming or investment/offshore money?
ask next generation if they want it and if you think they have skills to manage it properly. if answer is no to either you have to consider it. agree with last post, no pencil makes that work. based on what we know today, you are crazy to pay that. maybe they have better spiritual advisor than me...

for next few months i believe around here land has reached its top - cash rent values are below the 5-6% return mark already. funny thing that the 100 year old farms understand their area and what it can produce. good luck to those that seem to know better.

[Partners]

Sure hope those numbers come to our area soon..Easy decision for us...

[bucket]

I would be gone for half that amount.

[malleefarmer]

depends if next generation wish to farm

[charliep]

Just curious what you would do with the money?

A weird comment but land is likely like a home. What it is worth is irrelevant provided you weren't the last guy to buy at the top of the market. If your career/business decision is to farm, can the business pay its expenses/debt and provide your family a good living?

It may be time to re-jig your operation based on your stage of life, family members involved, debt load etc. It may also be a time to unload some land that doesn't have a fit in your operation.

Are you prepared to pay the kind of capital taxes or would you be using replacement property provision or some way to defer taxes? Where would you put the money these days that would be a safe investment/not subject to a lot of the concerns raised in other threads?

A very personal decision that will be different for everyone.

[bucket]

charliep

Exactly what kind of earning power does a home have other than increase in capital as does farmland right now.

But most homes can't provide a steady revenue income like farmland, can they?

[bucket]

And that revenue from a home can only be realized by selling it, then what, go replace it with something more expensive?

[wmoebis]

Lots of ways to look at it.

If you have 8 or 10000 acres paid for and spread it over all acres it may not look so bad.

Or if it puts you into next bracket to buy inputs cheaper, it off sets C.O.P.

May give you more market power.

[hobbyfrmr]

At 2700/acre I would sell and relocate, sounds like
I would become freewheat's neighbor and learn to
farm over there.
Just the other day, there was a land rent auction
near Krydor,Sk . Gossip says that land cash
rented for $114.00/ year. I do not know the real
facts, but, at that price I really have to think about
not selling, and just renting out and sitting on my
ass. That is respectable rent with no risk or
physical effort. I plan for next generation to have
my farmland in order to rent out.

[charliep]

Not making that comparison. Just highlighting I paid $135,000 for my house. Maybe could have sold (didn't do) for $350,000. Worth $300,000 today. One year from now? Anybody's guess. Still my house. Able to make the payments/not much mortgage. You are right - not an investment.

When farmers buy land, do you buy a productive asset that produces a product for sale or an investment that will provide long term return on capital? If the latter, why are people complaining when the value of this asset appreciates?

[SASKFARMER3]

At 75 to 100 rent you have a great return and
retirement income.
Problem Charlie is when you go into your bank
and say I guess I'm worth 10 to 17 million and
they say let's let a few years go by before we get
that excited. Land goes up and down the only
thing this time it's big blocks selling.
Serf farmers here we Come ah just like back in
the mother country.

[ColevilleH2S]

" why are people complaining when the value of this asset appreciates?"


Farmers usually spend decades trying to acquire land, and only a few years (if that) of their life looking to sell it.

[Daylate]

I would sign an agreement for sale with two guys i
know for $1/ac. Possesion date 2025. But i have to
wait another year till the youngest son can sign his
name.LOL! Till then ill keep on trying to do whatever
it takes to add sustained equity. Oh boy, semi
retirement is a long ways away.