Four Important Things to Know Before Buying a Ranch
Buying a ranch is a serious investment, so it is important to do your homework before signing on the dotted line. Start by drawing up a list of what you want in a ranch and what sort of lifestyle you plan to lead. Ask yourself if it is a full-time pursuit or a recreational escape? And do you have the time, knowledge, and skills to make it a reality?
Once you have looked at these factors, then you can start searching for properties, but before you do, please bear in mind that there are many things to know before buying a ranch, so take the time to carefully vet the properties. To get you started, we have written down four areas which need your full consideration.
Living out in the great outdoors is a dream for many people, but the reality is that cultivation of that dream takes handwork on an almost daily basis. There are so many moving parts, and you should always be prepared for the unexpected. The good news is that at the end of a hard day’s work, you will be able to sit back and enjoy the view.
For some people, working in the open changes the whole meaning of work, and it soon becomes a way of life, but for some folks, there is a real possibility that you may be overwhelmed by the number of things to do. One solution is to take on staff or hire a ranch manager, but this may be unnecessary if you come into this new venture with a full awareness of what it will take to make it a successful venture.
We advise you to discuss life on a ranch with existing ranchers and people in the areas you are looking at. They can be an excellent source of information on the local area – its unique attributes, the pros and cons of the land, local flora and fauna, government rules, and a whole plethora of things that are worth knowing before investing.
The Lay of the Land
Once you have a good idea of what sort of thing you are looking for, it is worth spending some time on the ranch lands of the local area. This will enable you to get a real feel for life in your chosen part of the country and the unique opportunities and challenges that you are likely to face.
Spending time on the ranch and questioning sellers will enable you to learn all about the harvests, quality of the local water, the local wildlife, and what cattle can thrive in the area. The last thing you want to do is buy a ranch and then find out it isn’t suitable for your desired goals.
State and Federal Rules, Taxes, and Conservation Policies
Whatever your goals, you will need to learn all about the various laws, rules, and projects that are running in the area. This can significantly impact your operations, so you will need to have a good understanding before diving into a purchase. Ranch management companies can be indispensable in this area because they will have a clear idea of local zoning laws, hunting licenses, conservation easements, etc.
For example, allowing part of the property to remain undeveloped to cultivate local ecosystems can result in certain tax breaks or credits. This can have an impact on the value of the land and its future selling price.
Mineral and Water Rights
Another tricky area of land ownership is mineral and water rights, which is a potential minefield for people unfamiliar with the intricacies of the law. When looking at properties, you need to ask what rights the property has and how long they are valid for. If the property comes with significant water rights, then you will have the opportunity to manage the water on the property as you see fit, ideal if you are planning on developing new irrigation channels or setting up fisheries on the property.
Also, mineral rights mean you own the land above and below the surface. This may be an excellent source of income in the future if deposits are found, as you would control access to these resources. However, if someone else owns the rights, then this can lead to disputes over access to the land.