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How to Buy a Ranch: 10 Things to Consider – United Country Real Estate

Posted by abreitenbach on January 14, 2022

Everything You Need to Know About Buying a Ranch

If you dream about rolling grasslands, wide-open spaces, and mountain views, investing in a ranch can make that dream a reality.  First, you will have to learn how to buy a ranch because it will require real work to make your investment worth it.

How will you make buying a ranch a good investment that will yield profound returns and intangible benefits?  How much does it cost to buy a ranch? How will you choose your property wisely?  

Here are important things to consider:

How to Buy a Ranch

    1.  Location

Get the most of your investment in buying a ranch by choosing the best location where you can get a good return on your ranch investment.  Learn the locations that offer prime elevation, desirable weather, and good topography so you will not sacrifice more than you invested.  

Is the location best for crop production with ample irrigation?  

Does the location increase the value of the land?  Know how the location of the prospective ranch can impact the land’s ability to generate income and its appreciation.

    2. Access

Any real estate property has better opportunities when it is more accessible.  Legal access is always considered, even the rights of others to trespass your property.  You should consider the access from and/or near a country road and if you are allowed to access any part of the land any time of the year.  

Are there areas that offer threats when accessed?  Do others need to pass by the land to access their property or do you have to cross another person’s property to access the land?

    3. Title

One of the most important lessons you need to learn on how to buy a ranch is to make sure that the property you are buying has a clean title.  

This will prevent more complicated issues in the future.  These important aspects of a clean title should be present:

  • How the land was conveyed
  • Encumbrances in Schedule B-2
  • Easements
  • Right of first refusal of neighboring properties
  • Restrictions on the property
  • Mineral rights
  • Liens
  • Enrolment in federal-state programs for restrictions on the property
  • Potential fence line issues
  • Ditches that deliver water to neighbors

    4. Water and Water Resources

A property is useless if it doesn’t have access to water.  Make sure the ranch property you are planning to purchase has well-established water rights that will make agricultural and recreational practices possible.  

Know if the water rights of the property are leased or encumbered separately.  Well-established water rights are a great asset to the property.

    5. Mineral Rights

You should know if the property holds mineral rights that add value to the land.  Most importantly, you should be able to provide security for the land to prevent greater problems in the future.

    6. Conservation Values

The value of the property is impacted by the presence of pristine scenery and wildlife.  Is the land part of conservation programs even in the presence of agricultural and ranching activities?  

Landowners are often paid for being involved in worthwhile causes or ecological services like:

  • Conservation easements (provides financial advantages for landowners)
  • Wetland mitigation banking
  • Grassland carbon sequestration
  • Watershed investment funds  

    7. Recreation

When investing in a ranch, there’s a long list of things that you can do.  Ranch owners include many recreational activities like fishing, hunting, hiking, and other activities that increase the value of the land.  

But these recreational activities will still depend on the quality of the natural elements that provide these types of recreation.  

Understand the ecology and the condition of the habitat of the property through getting a biological assessment of the land.

    8. Agricultural Use

Ranches are typically bought for their agricultural use.  And yet, the economic value of the land is greatly determined by the quality of livestock production or crop production on the land.  

Study the current state of production of the land and know how it enhances the land value.  Is there more that you can do to improve how the land generates income?

    9. Proximity to Public Lands

There are requirements for the use of public lands for grazing and other agricultural activities.  

If the land will depend on grazing for it to generate income, make sure that you have the necessary permits.

    10. Personal Property and Fixtures

When you choose to raise livestock on your ranch and grow crops, you will need to install infrastructure.  Basic infrastructure should be included in your operational strategy.  

Likewise, you will need to have the land and livestock evaluated and assessed by professionals.

Is Buying a Ranch a Good Investment?

More and more individuals desire space, freedom, and a connection with nature.  Buying a ranch can be the first step to owning that desire.  

The New York Times reported: “With some prized ranches down as much as 30% and returns holding steady around 3% a year, ranch land is looking more attractive as an investment.”

Experts suggest that the most important aspect in buying a ranch is to make sure that you know how to use the land that you purchase or else you will be wasting the potential of your ranch investment.

With the prices of commodities always rising and with good judgment and management, a ranch investment can offer you steady returns.  

It’s a safe place to park your money and you can enjoy special tax treatments like deferred capital gains taxes.

Best Place to Buy a Ranch

According to United Country Auction Services, considering the key factors that provide an answer to this question, the best places to own a ranch in the U.S include:

  • Kentucky
  • Oklahoma
  • North Dakota
  • Texas
  • Montana

The factors that come into play in determining the location of your prospective ranch include the cost of land, property taxes, climate, infrastructure, and mineral production.  How you choose to use the land will also be a contributing factor in determining the best place to buy a ranch.  

The different ways a ranch can be used include cattle ranch, hunting ranch, recreational ranch, or luxury ranch.



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