# Farm ground for sale



## CowboyRam

There is a farm here that has just come up for sale. 208 acres about 4 miles out of Riverton right off the highway. They are asking $995,000 for this farm; nice flat peace of ground, no buildings. How can anyone farm that ground at that price?


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## rjmoses

Anyone can farm that ground--but they'll probably go broke! That's about $5,000/acre meaning the annual nut on a 80% loan ($800,000) at 5% interest would be $40,000/year which, in turn, means you would have to net about $200/year/acre.

Ain't gonna be doing that with row crops anywhere. Probably not cattle in your area. But, a ski resort might be able to swing it.

Just thinking,

Ralph


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## somedevildawg

But it's flat Ralph....powered ski's? I ain't much of a skier.....


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## rjmoses

somedevildawg said:


> But it's flat Ralph....powered ski's? I ain't much of a skier.....


Now, that's my kind of skiing. I can handle it.

Ralph


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## swmnhay

rjmoses said:


> Anyone can farm that ground--but they'll probably go broke! That's about $5,000/acre meaning the annual nut on a 80% loan ($800,000) at 5% interest would be $40,000/year which, in turn, means you would have to net about $200/year/acre.
> 
> Ain't gonna be doing that with row crops anywhere. Probably not cattle in your area. But, a ski resort might be able to swing it.
> 
> Just thinking,
> 
> Ralph


Here $5000 an acre would work just fine but here is not Riverton,WY either.


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## paoutdoorsman

208 acres of flat farm ground here would fetch well over $995K. But I can't begin to answer the question as to how it pencils out.


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## jedp

Seems the "big get bigger and the small go away" principal to me. Watch it happen here all the time. Sad in my mindset. Someday, there will be no small, only big. I'm not sure that's a good thing...


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## Teslan

Does that price include good water rights, wells and pivots?


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## CowboyRam

Yes. It is on the same irrigation canal as the one we are on. Half of it is flood irrigated, and the other half has a solar powered wheel line.


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## Teslan

CowboyRam said:


> Yes. It is on the same irrigation canal as the one we are on. Half of it is flood irrigated, and the other half has a solar powered wheel line.


I guess with water rights if they are good it seems to be a fair price. At least compared to around here. Is it shaped that one could install a pivot or two? Flood irrigation gets old (I do 70 acres of flood) I don't know much about the wheel lines. They've always seemed not to put enough water on. If hay prices were good and you had most of your equipment already and paid for or nearly paid for I believe one could make a go of that property. Ok fine. I'm selling out here in Colorado and moving up to Wyoming. I should be able to sell everything here and build a nice house, hay barn, install a couple pivots and not be out much of anything. I don't like the next to the highway part. But maybe my idea of highway traffic is different then highway traffic in WY. But one question. Is there a large international airport 45 minutes away? My wife likes to travel.


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## Lostin55

Teslan said:


> I guess with water rights if they are good it seems to be a fair price. At least compared to around here. Is it shaped that one could install a pivot or two? Flood irrigation gets old (I do 70 acres of flood) I don't know much about the wheel lines. They've always seemed not to put enough water on. If hay prices were good and you had most of your equipment already and paid for or nearly paid for I believe one could make a go of that property. Ok fine. I'm selling out here in Colorado and moving up to Wyoming. I should be able to sell everything here and build a nice house, hay barn, install a couple pivots and not be out much of anything. I don't like the next to the highway part. But maybe my idea of highway traffic is different then highway traffic in WY. But one question. Is there a large international airport 45 minutes away? My wife likes to travel.


You may need to adjust your expectations of "large, international"


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## Lostin55

You are only two and a half hours south of me, but if I had to guess, someone lost their rear end on an auction when they sold out. Equipment prices are in the tank. Now they may be trying to make it up from land sales. Either that or the bank wants more skin in the game this year for the operating note on the rest of the place, thus the land sale.
There are several folks around here either selling land, or preparing to sell land for just those reasons. It is ugly, and getting uglier fast. Here, it seems to sell around $3500/4000 acre for really good ground. Right now it won't pencil out even at those prices. 
Row crops are in the tank, beans have been well under $30/bushel, corn is down, beets are horrible, and hay isn't worth much. That pretty much leaves Alfalfa seed and maybe some grain, which is also down, as options. Coors and Budweiser cut barley contract s 40% this year, by acreage.


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## CowboyRam

At $100 to $120 a ton for Alfalfa hay I don't think one could make it pencil out. Maybe if the price was at $200 per ton like it was a few years ago.


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## Lostin55

This year I spent about $350/acre to plow it under and work it, seed it, and fertilize it, on a new seeding. Granted, the seed was $7.47/lb and I planted at 20#/acre.
Add in irrigation, taxes, and payroll and your pencil would have to be a lot sharper than mine to make it work.


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## CowboyRam

I think the only way someone could make any money on that parcel is to subdivide it, but that might take several years before they make any money. There is not allot of building going on here. Last year the City only issued permits for new houses.


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## Lewis Ranch

I'd love to own some ground but unfortunately I wasn't born into land or farming and land prices are the same here. 4K an acre and up, I've tried to pencil it 10 different ways and can't make it work. Unless something drastically changes I'll be working on lease ground for a while longer.


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## PaMike

Here in my area of PA a 100 acre farm will bring 1.5 million. Most all are being bought by people with off farm income or by someone that already has multiple farms...

Seller can always ask sky high price and hope they can reel a sucker in...


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## Teslan

Lewis Ranch said:


> I'd love to own some ground but unfortunately I wasn't born into land or farming and land prices are the same here. 4K an acre and up, I've tried to pencil it 10 different ways and can't make it work. Unless something drastically changes I'll be working on lease ground for a while longer.


In some ways renting land can be a bit better sometimes. You don't have to pay the property taxes, which here has doubled in 4 years. You usually don't have to pay for costly irrigation equipment repairs unless it's part of the lease. But maybe you don't have irrigation equipment to worry about. Or the insurance on such things. Here you don't usually have to pay for water assessments or well augmentation plans directly out of your pocket. Depending on the type of water or the well the rent varies though. I usually figure here the payment on a loan to buy a property is roughly double the rent price if you have 20% down. But who hardly has 20% down unless you have other land to wrap into a loan. Plus all the other expenses. Of course with renting you can lose those leases and in the end you don't own anything. So there is that.


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## Lewis Ranch

Teslan said:


> In some ways renting land can be a bit better sometimes. You don't have to pay the property taxes, which here has doubled in 4 years. You usually don't have to pay for costly irrigation equipment repairs unless it's part of the lease. But maybe you don't have irrigation equipment to worry about. Or the insurance on such things. Here you don't usually have to pay for water assessments or well augmentation plans directly out of your pocket. Depending on the type of water or the well the rent varies though. I usually figure here the payment on a loan to buy a property is roughly double the rent price if you have 20% down. But who hardly has 20% down unless you have other land to wrap into a loan. Plus all the other expenses. Of course with renting you can lose those leases and in the end you don't own anything. So there is that.


No irrigation here land rents range from free to $20 an acre so owning is considerably more expensive. Leasing is tough because you can't get long term agreements anymore.


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## luke strawwalker

swmnhay said:


> Here $5000 an acre would work just fine but here is not Riverton,WY either.


Here $5,000 an acre won't even get you flood plain ground... it's $14,000-15,000 an acre hereabouts.

Why it's all turning into Mcmansions... only thing you can grow on it that could possibly pay for it...

Later! OL J R


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## 506

The 33 acres next to me just went for $13500/acre. The house and barns are junk from what I can tell and from what I was told by a neighbor who tried the buy the place. I suspect that the new owner is from out of town and will only use it as a 'weekend country home'. They'll have to lease the land for cattle or will let the land lie fallow so as to avoid paying full property taxes on it. In order to get land in the <$4000/acre range one has to buy 1000's of acres at a time. That won't be me in this lifetime. Maybe in the next. We'll see.


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## Teslan

It seems there is always a non farming entity that will and can pay more for farm ground then actual farmers. A number of years ago my dad and I made an offer on a 120 acre farm. It had great water rights and an irrigation well and that is a big thing here. It didn't have pivots which it would have to irrigate it effieciently. It had been on the market for a year or more. It was before I was a real estate broker and I think I was 22 years old so I knew next to nothing about real estate. We made the offer and immediately a water district made a higher offer. We couldn't go higher. So the water district bought it. They dried up the property. Meaning took the water. Auctioned off the land for about the same price they paid for it. The guy who bought it at auction. divided it up into 20 acre lots and doubled his money. Who knows where the water went. It was worth about as much as the farm at the time. In 2003 the supplemental water rights that had been with the property also was valued at about $ 2 million. Now is worth about $3 million. Never mind the irrigation water. So now that I know real estate I suspect the water district had a deal with the real estate agent. If you get any offer let us know and we will beat it. A water district that is funded by tax payers. A water district that I pay $4300 to use my irrigation well for 60 days a summer or so. And if I don't pay that money I lose the irrigation well pretty much forever. Thinking back we should have offered more, but probably still would have failed and it would have put us in debt quite a bit for the farm and pivots we would have installed. But 5 years later we would have sold the supplimental water and been out of debt and more and still had the farm and irrigation water. So I look now at that water district with a lot of distrust.


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## Vol

Good story Marc....I think many of us have had some kind of dealing with government or bureaucracy where we got the short end of the stick. I have missed some deals in my lifetime because i thought that I could not pay anymore....when in reality I should have and I would have been better off for it.

Regards, Mike


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## somedevildawg

Sounds as if you didn't have a chance.....they were gonna beat you with your own money 

Can you expound a bit on the "water rights" deal.....seems like an interesting/expensive money grab


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## Teslan

somedevildawg said:


> Sounds as if you didn't have a chance.....they were gonna beat you with your own money
> Can you expound a bit on the "water rights" deal.....seems like an interesting/expensive money grab


ok I will try. We are on a ditch company for our farms and the farm I spoke of. We have shares. That farm had 6 shares. This is irrigation water from the south platte river. They are good rights. Back to 1865 or something. So we aren't shut off to early in a dry year. In addition at the time there were 30 units to each share of Colorado Big Thompson water project. 1 unit is 1 acre foot of water, This water comes from grand lake on the other side of the mountains. It is used for farming and more often now development. For us it just amounted to about 20 days of irrigation a season. This is in addition to the main shares of water. Supplemental water. In 2003 we sold ours as did many other people. With that farm we offered on we could have sold that water for about $2 million. But this was in 1997 and no one new that supplemental water would go up so much in value. Since 2003 I have missed owning this water for maybe 2 weeks during the drought of 2012. Now the water district is in charge of augmentation plans for augmenting the aquifers water level from what is pumped out of irrigation wells. I am allowed to pump about 120 acre feet a year. I pay this district $4300 a year and they provide water from other sources to augment what I'm taking out of the ground. This is why the water district wanted this farm. For the 6 shares of water and the 30 units each of the Colorado Big Thompson water. There is more that I could write about the augmentation plans for irrigation wells but I'll stop now. The district didn't care about the land. The water is what they were after. They were thrilled to auction it off the land for the price they paid for the land and water together. I think we offered something like $300k. Seems cheap now. But at the time my dad was splitting farming operations from his sister in law and the farm needed some upgrades in the form of at least two pivots and that would have cost probably more then $100k. We were planning to lease out the farm at that time so cash flow was important to make the payments and much above $300k wouldn't have worked well. But with 20/20 hindsight it would have been worth making a sacrifice for 5 years. But who knew.


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## rjmoses

Following this discussion on water rights is amazing to me. The right to have water on your property and use it is just something we don't even think about hereabouts.

In fact, it is often just the opposite. A friend of mine got into a big dispute with his neighbor by re-directing excess water flow onto his neighbors property. I have a problem with the road district re-directing runoff from the roads into my fields, causing erosion.

Right now, we have too much water--the road on the Missouri side of the Mississippi river is flooded behind the levees and the water cannot get out. What should be a 10 mile trip is more like a 35 mile trip.

Ralph


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## Teslan

rjmoses said:


> Following this discussion on water rights is amazing to me. The right to have water on your property and use it is just something we don't even think about hereabouts.
> 
> In fact, it is often just the opposite. A friend of mine got into a big dispute with his neighbor by re-directing excess water flow onto his neighbors property. I have a problem with the road district re-directing runoff from the roads into my fields, causing erosion.
> 
> Right now, we have too much water--the road on the Missouri side of the Mississippi river is flooded behind the levees and the water cannot get out. What should be a 10 mile trip is more like a 35 mile trip.
> 
> Ralph


Well the water doesn't get here to the farm naturally. Canals from the South Platte, and Poudre rivers is what irrigates nearly all of the front range of Colorado clear out to the Northeast corner. A network of reservoirs and canals. Most cities get their water from the same sources using the same kind of water rights. Though I suspect many municipalities use it out of priority (Denver) Meaning Denver with it's say 1920 water rights uses water ahead of the water rights down stream established in say 1890. In fact there is a place near the water works of Denver where in July/August in the morning and evening the South Platte river is dried up while people are taking showers and what have you. And from where the water goes into the plant and where it exits the river is dry. But given the infrastructure with these water systems one would expect to have to pay for it. And there is supply and demand at work as well. Only so much water runs off the mountains. Some years more then others. The farms here and in WY like the thread is talking about are valued not so much on the dirt and farmable acres, but how good the water rights are. Meaning how much water are you allowed, how the system delivers the water. I could go and buy 1000 acres of dryland for the price of 160 irrigated acres or even less in many cases.

What I'm waiting for is the U.S. Government to do something silly and regulate all the wetlands, canals, reservoirs with some sort of environmental nonsense when all but the rivers themselves are man made. That is looking less likely under Trump's administration. But who knows how long that will last. Could be months could be years.


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## somedevildawg

That's very foreign to me.....we drill a hole in the ground or run a pipe to the river/creek/pond. Whatever is the most economical


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## RockyHill

whew, this is more mind boggling than baling hay at night 

Shelia


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## Teslan

RockyHill said:


> whew, this is more mind boggling than baling hay at night
> 
> Shelia


Its always boggled my mind that you folks in the east pretty much get to cut and bale hay then just let the hay grow without irrigation. But then you can't just shut off the water when it's time to cut either. . Sometimes that seems much less complicated.


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## rjmoses

Teslan said:


> Its always boggled my mind that you folks in the east pretty much get to cut and bale hay then just let the hay grow without irrigation. But then you can't just shut off the water when it's time to cut either. . Sometimes that seems much less complicated.


Nope!

You guys out west have it easy! You can always get it dry, just can't grow it. We can grow it, just can't get it dry. Maybe we could meet in the middle?

Ralph


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## Teslan

rjmoses said:


> Nope!
> 
> You guys out west have it easy! You can always get it dry, just can't grow it. We can grow it, just can't get it dry. Maybe we could meet in the middle?
> 
> Ralph


i think that is somewhere in Nebraska or Kansas.


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## RockyHill

Ok, so what does hay sell for out there?

What little I know about irrigating around here was for tobacco years ago and that wasn't a standard practice and very few farmers tried. Farm ponds were the water source, tractor pump, aluminum pipe and sprinkler system. All the expenses (and work) just wasn't worth it for a good cash crop.

Where I'm going with this, our area of the country has what sounds to me like low priced hay but we don't have the work of irrigating, and equipment expenses, did not know about the cost of the water itself.

Shelia


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## luke strawwalker

Teslan said:


> It seems there is always a non farming entity that will and can pay more for farm ground then actual farmers. A number of years ago my dad and I made an offer on a 120 acre farm. It had great water rights and an irrigation well and that is a big thing here. It didn't have pivots which it would have to irrigate it effieciently. It had been on the market for a year or more. It was before I was a real estate broker and I think I was 22 years old so I knew next to nothing about real estate. We made the offer and immediately a water district made a higher offer. We couldn't go higher. So the water district bought it. They dried up the property. Meaning took the water. Auctioned off the land for about the same price they paid for it. The guy who bought it at auction. divided it up into 20 acre lots and doubled his money. Who knows where the water went. It was worth about as much as the farm at the time. In 2003 the supplemental water rights that had been with the property also was valued at about $ 2 million. Now is worth about $3 million. Never mind the irrigation water. So now that I know real estate I suspect the water district had a deal with the real estate agent. If you get any offer let us know and we will beat it. A water district that is funded by tax payers. A water district that I pay $4300 to use my irrigation well for 60 days a summer or so. And if I don't pay that money I lose the irrigation well pretty much forever. Thinking back we should have offered more, but probably still would have failed and it would have put us in debt quite a bit for the farm and pivots we would have installed. But 5 years later we would have sold the supplimental water and been out of debt and more and still had the farm and irrigation water. So I look now at that water district with a lot of distrust.


Yep... dirty pool at it's finest.

Why I don't support ANY of that gubmint crap. Thank God Texas is "right of capture", IOW, if the water is under your land, it's YOURS.

Hard to compete when your #1 competitor is TAXPAYER FUNDED and you have to FUND THEM AS WELL...

later! OL J R


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