7 Tips You Should Know Before Selling Your Farm
We Asked the Experts
Posted on April 30th
2020 by Mason Spurgeon
Farms, to many people, are the largest asset they own. So when it comes time to sell, you want to make sure it is done right to maximize your return.
Selling a farm can be an overwhelming task for many landowners, especially if the property was inherited. Before selling your farm, there are several things to be done. We asked experts to give us tips on what a seller should do before selling their farm, and these are the best 7 tips.
Get the Price RIGHT!
In order to make a quick sale on your property, price your farm no more than 5 to 10% over market price. This will give a potential buyer the sense of urgency to act, and a buyer will come to the table fast because they know the property will sell fast. - Kevin Small, United Country Land Pros
Make the Place Presentable – Tidy Up
The biggest tip I can give a landowner when preparing their land for sale, outside of pricing it correctly, is to get the property as “market ready” as possible. What I mean is to have it look its best before it goes to market. Mowing up the roads and trails and grown up areas that would normally be mowed, fixing up gates that are laying over, or not hanging straight, and cleaning up old junk that may be laying around—make the property have the best “curb appeal” possible! This really helps farms sell when they “show well.” Think of it as if you were the buyer: when it looks good, it’s more appealing to a potential buyer. – Jeff Propst, Whitetail Properties Real Estate, LLC
“You never have a second chance to make a first impression.” It seems fairly obvious, but there are many times the seller can make a few changes to improve the sale of their farm. It is as simple as mowing areas, hauling off scrap metal, burning brush piles, and making the farm look organized. Lastly, on tillable farms, anything you can do to increase the percent of tillable acres helps the sale of the property. Regrading waterways and terraces, drain tiles, and removing trees or fence rows—these all help in the sale of the farm. - Jose' B. Cruz, United Country Land and Lake Properties
Consider Dividing the Property (Think about its Highest and Best Use)
Consider selling multiple tracts to drive a higher price in total. Just know it may extend the total time it takes to sell it all. – Wes Tuley, Ragar Realty
Get a Survey (Know Exactly What You are Selling)
When selling or buying a farm, it’s a very good idea to have the property surveyed. Not only can it make any potential buyers more comfortable by visually seeing the property lines, it can also promote a good relationship with neighbors when all parties know their boundaries. - Kurt Hollenberg, United Country Missouri Land & Home
I would recommend that any seller obtain a survey of their land. In my experience, many landowners have passed down their land to their children. This is great, but sometimes the actual property lines get lost in the transfer of ownership. This will eliminate the possibility of any disputes with adjoining landowners. – Amanda Allen, Missouri Central Real Estate Co. LLC
Decide: Auction or Listing?
When selling land, not all farms benefit from the same marketing approach. Now more than ever, certain types of land could be better suited for varying types of marketing strategy. While moderately sized Class A soil-rich farms could likely do well across all platforms, that isn’t the case for other classifications of land. Oftentimes, recreational or larger hunting tracts can be risky or highly volatile under a public auction format. One must also closely analyze the size of their land and geographical location. If a farm is large and conducive to parceling into multiple tracts, then that must be considered. Conversely, breaking the farm up into too many sections can have a negative impact on value, so this practice isn’t always as easy as it sounds. One must think over many options and utilize a trusted professional to navigate situations like these. – Luke Worrell, Worrell Land Services, LLC
Work Smarter... Not harder... Let Drone technology do all the work to sell your land/farm property. Drones can uniquely Tell Your Story about the land/farm property you want to sell. Practice Makes Perfect: This tip is crucial for anyone who has never operated a drone before. You should not attempt to rush this process, as doing so could lead to wasted time, money, and even pose safety concerns. Give yourself time to practice operating the drone and trying out different locations/positions. - Karen Funkenbusch, Missouri Beginning Farmers & Ranchers
Call a Professional
If you are considering selling land, work with a local agent that you trust, who knows the industry and the area. Selling land is an in-depth process: you need to be able to price it with the market, provide aerial maps, soil maps, FSA information, crop history, cash rent agreements, boundary lines, etc. Having an experienced agent who knows the area, the market, and where to find this information and make it available to potential buyers, will make the selling process so much easier. Also make sure they are able to effectively market your property - having your listing in the right websites and publications will ensure a timely sale. - Jennifer Wood, Fretwell & Associates Real Estate
I believe that the most important thing for a seller to do when selling their property is use a land broker who is familiar with the general region and current market conditions of the specific property. The guidance that a knowledgeable land broker can give to a seller is invaluable to making sure the seller maximizes sale price. This is done through the expertise and market insight of the broker when it comes to price and marketing of any individual property. - Brad Belser, Illinois Farm and Rec Land
If you are going to sell your farm, do your homework. Gather all the information you have about your property and have it ready for the listing agent, buyer, or the appraisers. It will make everything easier and faster for all the parties involved, if you know exactly what you are selling.
Overall, the experts recommend pricing and marketing the property correctly. I could not agree more. I have seen properties that were overpriced sit on the market for years, and properties that were not marketed properly sell for less than market value, only to resell shortly after for a higher price.
Whatever you decide to do with your property is your business, but consider enlisting some help from real estate professionals, i.e. real estate agents, auctioneers, or appraisers.