The process of selling a farm or ranch is both an emotional and financial deal. You might have inherited the farm or it might have been in your family for much generation and thus selling it is a difficult and wrenching decision. Find some tips in this article that will help lessen the strain a bit:
Appraise the value of your farm. Get an experience farm appraiser and contact the local cooperative extension service for assistance in valuing your property or determining how best to sell it. The appraisal should include highest and best use; which suggests the property could be rezoned from agricultural to more valuable development now or in the future if property is in the path of growth. Be sure to check plans for freeway expansion in the area. Be careful to have farm properties specialty appraiser since residences and other properties are very different in terms of land value, use and other considerations. The operation’s overall income potential is a vital factor in helping estimate the value of the farm, as is the livestock’s value, machinery and equipment, and the condition and the age of any buildings, such as pens and barns.
Hire a real estate agent. Get a real estate agent who has prior experience selling farms to broker the property. This will cost you some money but the good thing is that you will broaden your farm’s exposure to prospective buyers. The commissions paid can be negotiable but will usually ranger from 2.5 to 3 percent.
Auction your land. Even though auctioning can yield a price below the market value, you can always set a reserve price below which you will not agree to sell. However, in some instances auctions can turn out in a purchase price far above what you might have expected, if competition is fierce. Make sure you inquire from the auctioneers the best time of the year for selling off farmland.
Value other assets separately. If you have other assets such as barns, grains and other improvements on your farm, then you need to value them separately at the time of sale to establish a basis for depreciation for the new owner.
Work with qualified tax professional. Make sure that you work with a tax professional who is qualified to ensure that every tax ramification of selling property is taken into account.
Visit SW Ranch Sales for more information on selling your ranch or farm.