Bartering for land?

[dillpickle]

First of all awesome forum! I have spent the last 6 hours just hanging out and reading and I finally decided to sign up and post!

So my question is pretty simple.

I have heard about a few cases here and there where people have received land in exchange for care-taking, or crop-sharing, but I have never seen a strategy outlined.

Does anyone have any ideas on how to approach this?

Id be wiling to grow my own and split crops and some livestock but I eventually want to OWN land (not just borrow or rent). Any ideas?


Thanks

 

[FarmerJamie]

First of all awesome forum! I have spent the last 6 hours just hanging out and reading and I finally decided to sign up and post!

So my question is pretty simple.

I have heard about a few cases here and there where people have received land in exchange for care-taking, or crop-sharing, but I have never seen a strategy outlined.

Does anyone have any ideas on how to approach this?

Id be wiling to grow my own and split crops and some livestock but I eventually want to OWN land (not just borrow or rent). Any ideas?


Thanks

First, welcome!

The first piece of advice is to get started on some sort of legal contract set up defining the agreement, particularly covering the situation if the current owner passes away before you take title. My wife is a realtor, and she's seen cases where the person "working off" some property lost their time and sweat investment because nothing was documented and the heirs were not as welcome to the idea of the land deal being worked. I would be also concerned about making sure everyone understands how the yearly taxes are to be handled on the property over the course of the transaction.

One approach is to first do a little math. Take the price of the property, figure out what the cost of a mortgage would be (easy to do with an online-mortgage calculator or spreadsheet). Then figure how the value of your labor/"sweat equity". You'll then need to do some negotiation with the current owner, just as if you were buying it outright.

This can be a great way to buy a homestead, but it might be a long process, and you'll need to make sure you're covered legally.

I hope others here can provide more advice. "Land contracts" are similar, but don't necessarily fit what you are trying to do.

 

[hwillm1977]

We're 'renting-to-own' our current property... it's not working it off using sweat equity, but we also didn't have to get a mortgage.

We went through a lawyer and have a registered contract, if we ruin the house we still owe the money, if he passes away we finish paying the heirs... but we made our last payment in December so the house is officially ours now. It took us a LONG LONG LONG time to find someone willing to rent to own... like years of looking at abandoned houses in the country, finding out who owned them, and offering to rent-to-own the properties... we asked more than 30 people before we finally found one willing to do it. We paid all the taxes, and all lawyer fees, all utilities, and it was written into the contract that we had to put $10,000 of improvements into the house within the first 12 months.

It's an interesting concept to work off the value of the land, but I really think it would be hard to find someone willing to do that with land that was currently worth anything... working farmland, a lot full of hardwood, etc., is going to be worth more to the owner if they just sold it instead of trading for sweat equity. You might find a cut over woodlot or something that you could turn into farmland with a lot of work... where I live you can buy 100 acre woodlot that's been cut over for under $30,000. But it would be in the middle of nowhere, and scrub land.

WELCOME to sufficient self!

 

[Beekissed]

I've known a couple of people who made deals with old farmers who have no children...they take care of him at home until he dies, they get the land. Until he dies, they work the land, maintain the buildings, etc. the way he dictates, all farm profits are still his, etc.

Legally binding contracts stating such is imperative, as well as a change in the will of the landholder, in these cases. Ive seen some awful nice farms transfer hands in this manner.

 

[~gd]

Backing Bee, I have seen entire working farms changing hands thia way, the owner gets too old to keep up the farm and doesn't have the money to hire help, that leaves 3 choices for the owner, sell, rent or enter into an agreement with someone more able. Often the able one doesn't really know farming, and doesn't have the money to rent or buy. Small Dairy farms are popular here because the peak labor [milking] can be done before and after an off the farm job held by the able one so he/she can learn while they earn. I have heard of some structered like reverse mortgages and even deals that take advantage of the gift tax laws. The fact that in the country you can park a trailer home and tie into existing water and septic systems helps too. The one thing that everyone agrees on is that a good lawyer accountant needs to overview the deal looking at laws and regulations that can ruin the deal.

 

[Denim Deb]

Depending on where you are, it can be hard to find, also. Around here, I doubt that you'd be able to do it. It's getting more and more populated, and land prices are just too high. I'm seeing housing developments spring up all over advertising houses from $170,000 and higher. Unless there's something wrong w/the land (too wet, pine land conservation, etc) land normally sells for well over $50,000 an acre. Just one of the reasons I want to move out of this area.

 

[hwillm1977]

I guess it depends on where you are... a dairy farm here is horrendously expensive because of the quota laws we have for dairy. It's hard to get a quota (generally costs about $25,000/cow you want to milk and if you want to sell milk you have to have a quota), once a farmer has it they keep it or sell it at a profit, there are limited quotas... farms that have good quota will sell for millions here...

I think if you work at it and don't mind rejection from some people you could eventually find a place to get like that. It would just take perseverence

 

[dillpickle]

Thanks guys for all the great advice! I have bookmarked this thread! Thanks again!!

 

[Dawn419]

The first piece of advice is to get started on some sort of legal contract set up defining the agreement, particularly covering the situation if the current owner passes away before you take title. My wife is a realtor, and she's seen cases where the person "working off" some property lost their time and sweat investment because nothing was documented and the heirs were not as welcome to the idea of the land deal being worked.

FJ is dead on with this information!

Here's a long read about what happened to some people in TN who started building their dream, only to have to tear it down and start over again.

Non-Electric Homestead in McMinn County

Hubby and I tossed the idea of bartering/care taking for some land and after I read the above, we quickly got over it and decided to buy the 17 wooded acres that we call home.

Hope this is some help!