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    Ranch Investor Wisdom

    Over the years we have had a large number of “how to” or “how do I” buy ranch real-estate threads here. Most of those threads pertain to finding or financing land. I’d like to hear from those of you who have bought and sold ranches who would be willing to share some of your experiences.

    For anyone generous enough to spare some time and share some wisdom, following are a few questions in an effort to get things rolling:

    What was your best experience? What made it the best experience?

    If you could go back and change one thing, what would it be?

    What aspect of a particular piece of property brought you the most joy or satisfaction?

    What was your biggest headache?

    What improvements provide the greatest opportunity of profit?

    What improvements do you lose money on?

    Thank you in advance for allowing us to benefit from your experience.

    #2
    Good fences make good neighbors
    Never over capitalize a piece of property

    Comment


      #3
      Originally posted by TradAg02 View Post
      Over the years we have had a large number of “how to” or “how do I” buy ranch real-estate threads here. Most of those threads pertain to finding or financing land. I’d like to hear from those of you who have bought and sold ranches who would be willing to share some of your experiences.

      For anyone generous enough to spare some time and share some wisdom, following are a few questions in an effort to get things rolling:

      What was your best experience? What made it the best experience?
      My best and only experience was finding 1178 Madison County acres for sell in the Conroe Courier newspaper classifieds. What made it the best experience was the fact that me and the seller agreed on a price that was more than fair and it was such a good deal that the bank required ZERO money down to finance it.

      If you could go back and change one thing, what would it be?
      I sold the ranch in 2012 to finance a new business interest. That business has turned into a great business, but my wife and kids sure do give me a hard time about selling that place.

      What aspect of a particular piece of property brought you the most joy or satisfaction?
      Fishing for white bass with my wife on Bedias Creek. Seeing my kids and their friends enjoying the place. Trapping hogs with my buddies and managing low-fence deer and seeing them get better every year. Seeing my Dad and Mom relaxing on the porch. Watching a hayfield full of black cows with a calf by their side.

      What was your biggest headache?
      **** Cows and **** cowboys

      What improvements provide the greatest opportunity of profit?
      Money producing improvements such as hayfields, crops, stock facilities or structures such as houses. I added another 350 acres that adjoined another county road and I feel that having two access points, one on a state hwy and one on the county road made the land more valuable.

      What improvements do you lose money on?
      Fences, roads, drainage and outbuildings

      Thank you in advance for allowing us to benefit from your experience.
      See my answers in BOLD above.

      Comment


        #4
        Water and/or lack of it...makes or breaks a place imho...

        What I mean is flood plain, well, community water, tank, river, lake, etc etc...

        Comment


          #5
          Originally posted by kch73 View Post
          Water and/or lack of it...makes or breaks a place imho...

          What I mean is flood plain, well, community water, tank, river, lake, etc etc...
          Very true.

          Comment


            #6
            Following

            Comment


              #7
              Originally posted by curtintex View Post
              See my answers in BOLD above.
              TIL I have been doing it wrong. I need to be looking for land that's "for sell" and not "for sale."

              Comment


                #8
                Originally posted by 35remington View Post
                TIL I have been doing it wrong. I need to be looking for land that's "for sell" and not "for sale."
                hahahaha....yep. You got me.

                Comment


                  #9
                  Narrow the area you are searching. 4 counties is about as big of an area that you can fully understand the market, unless this is your full time job.

                  Study the comps like a hawk in that narrowed area for several year. Study the properties that sit versus the properties that sell fast. You need to feel 100% confident on what market price is in your area.

                  Work to understand what improvements are cheap and easy and what improvements are expensive and difficult. For example, I like to find properties that have had a house on them at one time and it is either gone now or so run down that the seller gives it no value. It's cheap to move or tear down a house. The big benefit is that you probably already have power, water and maybe septic at that location. Those can be very expensive to add to a property that has none, but you will not end up paying for them on the purchase if the house is gone or run down.

                  Any money you spend to add or enhance water features on the property makes you 4x what you spend on it.

                  Do not build a big house, tennis courts, any kind of Equine facility, nice skeet shooting range or nice vertical improvements. Most of the time, not always, but most of the time, you will get less than 50 cents on the dollar of what you put into those improvements.

                  Don't buy anything with easements or restrictions of any kind. If seller wants to put restrictions on at closing, say no or make sure that they have a time lapse on them.

                  Don't buy unless you have the money to hold for 5 years. Even if you plan to sell it after fixing it up in a year or two, make sure you have at least 5 years of carry. You never know when the market will turn.

                  You will make or lose 90% of your money based on your purchase price. Smart improvements are typically worth 15% upside at best. So Buy Right.

                  Obviously there are thousands of other variables, but those are the ones that come to mind. I'm interested to see what others have to say on this topic.

                  Comment


                    #10
                    Looking to get a place of my own within a few years, this is great information so far. Thanks!

                    Comment


                      #11
                      How does everyone view mineral rights? It seems on most tracts no rights are conveyed. That's always been a worry when looking for property.

                      Comment


                        #12
                        Mineral rights. a buddy of mine bought 1200 acres in coutulla about 12 -15 years ago and got no minerals. At the time he didn't think anything about it. He High fenced it and was lucky enough to have great deer genes and killed several deer over 200 inches then came the eagle ford shell. After 20 plus wells and more on the way and traffic like 35 on Sunday afternoons he couldn't take it anymore and Sold his place.

                        Comment


                          #13
                          you most likely will not get mineral rights anywhere

                          We bought a 500 acre ranch in 2000 - stunning place with two houses, two garages, pens, barn, etc. Had 8 acre lake on it and a live creek running through it. Paid $750K

                          HFenced it, improved deer herd, remodeled house, etc. Bought an additional 100 acres for cheap. Sold it five years later for 1.9 K plus we got to live there the entire 5 years.

                          We made good money on it - it is for sale now for a little under 5 mill by the owner - hard to beat real estate if you can live with it through real estate downturns.

                          Water is important as stated as well as location. I have also bought raw pieces of property, cleaned them up and added a few improvement (dug a pond for example or cleaned cedar) and turned it for a very nice profit.

                          my advice is find a really good real estate agent and look for property that is in the path of progress/growth. Clean it up and wait - in time you will make money

                          Comment


                            #14
                            Originally posted by CEO View Post
                            How does everyone view mineral rights? It seems on most tracts no rights are conveyed. That's always been a worry when looking for property.
                            I don’t need mineral rights and lots won’t convey especially in good drilling areas. I do need executive rights so a previous owner isn’t dictacting when and where the operators can build their roads, tank batteries and other details involved. There is no reason to buy and have no say over what others do on your place

                            Comment


                              #15
                              Haven’t bought ranches but a couple small pieces of land. But I know a guy who has had fortune 500 company and has bought and sold plenty and gotten rich off of it. Main thing he told me if you wanna make money don’t fall in love with it

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