Hi again Hydemarsh,
It is interesting, clearly I am speaking to an expert.
It was really most interesting to hear from someone on the other side of the fence doing the very thing my cousins had complained about. I.e., outsiders coming in and buying up the land at prices they couldn’t afford to farm at.
Assuming they are not just behind the times in productivity or technique it still seems like something has to give. It may just be that the family farm is doomed to go the way of many small businessmen.
Thanks for the insight and I do love the idea of diversifying in this manner. I have always thought about apartments (and have owned them before) but farm land seems much less of a headache.
Good luck!
Randy
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actually the family farm is not doomed, all of the tenants are family farmers not corpoations, however they are not small and to make a profit they have to have scale and be very efficient. Most hedge their production with futures contracts.
I do not buy land at prices the farmers could not afford to farm at. In areas with development potential the prices are such that farming will not provide a reasonable return. I will buy development land but not at speculative prices. I look for areas that are likely to stay rural and the soil quality will make it desirable regardless of the market condition. I think soil quality is the key (just like sustainable earnings and growth).
I can say that the housing bust a few years ago provided some excellent buying opportunities, just like the stock market.
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