Buy or not to buy?

My family and I are faced with a dilemma. I live in rural Indiana and have been around the farming community all of my life, though no first hand farm experience. We have developed our homestead on 6 acres, and this is where I plan on staying for my future, im 36. My wife and I are debt free....no mortgage, no card debt, no vehicle payments. My aunt and uncle own 23 acres of prime row crop acreage contiguous to my 6acres. The 23acres joins to a 60acre field owned by a farmer....my aunt and uncle cash rent the 23ac to the farmer. My aunt and uncle own the 23ac outright, but their investor has told them to unload it. Aunt and uncle's net worth is probably 4mill.

I've only been debt free for 6 months, but I would really like to buy this land since it is contiguous to my acres. The thing is is that it only brings in 200$ on cash rent which isn't much when this could be 10k/acre farmland. I despise debt, but feel this land won't be for sale again.

It was appraised last week, but I haven't heard a number yet and I might get a slight cut because I'm family but not expecting any cut...but a maybe.

I have 3 boys, oldest 11 and one lil girl. I'm really toying with the idea of purchasing some well used equipment to farm it myself. I do have a D17, 175, and 2 B's(not that they account for much, lol). I've been looking at old gleaners on the net and thinking this could be feasable to do myself.

I'm basically rambling looking for thoughts on this. I'm very handy with fixing equipment. If this is unrealistic shoot straight with me.

Shannon

Once it is gone it is gone. Buy it, don't look back. Always worth as much as market can bare!

I'm in a similar situation. We have a contact on 110+/- acres that backs up to our place. My theory is there's no better investment than land because there'll never be more made.

Buying land is a great long term investment. But don't let your  "I wants" be used against you by the sellers or the lender.  Know exactly what deal you are willing and able  to make and stick to it. A good Property Lawyer and a CPA are your allies . Also when farm ground is in play  keep your cards close and your mouth shut. More than one guy has been big footed when someone gets a whiff of a deal being made. 

Someone can correct me but hasn't prime agriculture land out preformed the stock market over the last 20 years. I think another point to consider is that if you own this 23 acres, you can protect what is next door. Don't have to worry about someone building a chicken house next door

Would your well to do relatives do a land contract at a fair interest rate? Better then what they get at the bank and less then what you can borrow for. Haven't financed any long term ag loans but don't think you can lock in interest for a 20 ag loan. Price of the land is one thing with low interest something different with higher interest.

Edited by DanWi - 29 Oct 2022 at 4:24am

Buy it.....

Buy it, X 4. 

Edited by nella(Pa) - 29 Oct 2022 at 8:10am

jaybmiller wrote: If,er..WHEN, you buy the 23 does it AUTOMATICALLY 'join' your 6 as ONE parcel of land ??  I was told long,long time ago..'the good Lord only made so much land, so buy as much as you can. The fact it's NEXT DOOR is a huge PLUS !! BTW I'd love to rent 23 acres of land for $200 !!! sigh.. btm line...BUY it !!

You do realize he means $200 per acre right?

And no, it won’t automatically become part of his existing land, will remain the parcel as currently documented. You can go through the process of putting it together but most people don’t, might keep it more marketable.

We're going through the FSA with our land deal too. Ours is a farm expansion loan. For us they require 3 years of reported schedule F in the past 10 years, signed contracts, current surveys, and the application before they will begin the process. We had trouble when we first built our chicken houses with the New Farmer and the women/minority deals. There was some reason why we weren't eligible but I don't remember exactly what it was.

Another wrinkle. If your aunt and uncle are willing to do a land contract or article of agreement. Then you take out a term life insurance policy on one or both of them. Thus creating  a buyout for the survivor or heirs if the worst happens.

Edited by exSW - 29 Oct 2022 at 3:34pm

You can buy on contract. Have bank create escrow account. You pay bank. You can agree on price and interest. If you miss a payment.... you lose it.

Hey guys, thanks for all the input! I wasn't expecting all of that. I still don't have any hard numbers on what they are thinking, maybe today I'll hear from them. There's some really good ideas on here and I plan on investigating them. Thanks again!

I'll keep you all posted on the situation.

Like has been said if anyway BUY IT. There is no more of it being made plus right next door.