September 16, 2019
Normally we talk about agricultural land, which encompasses farms and ranches. Fall is the time to concentrate on harvesting crops and getting the last cutting of hay in for a cattle herd. But fall is also the time to talk about recreational land because of the various hunting seasons coming up. Most areas of the country, even the driest Plains, have a little or a lot of recreational land suitable for hunting, building a lake, or a second home. There are areas within most states that have more trees, a more rolling terrain, or otherwise are not suitable for crops or pasture. Therefore, those properties are often referred to as recreational land.
Demand for recreational land is good due to the level of discretionary income available and the desire to have a place to hunt or call ones own. Good recreational land in the right places near urban areas or the areas known for great hunting has experienced steady to increasing land prices over the past few years. The price trend for recreational land has been counter to agricultural land because of the different demand structure and the fact that recreational land prices don't normally depend on crop and livestock prices. But, many recreational tracts have a significant portion of tillable acres that comes into the purchase equation when the buyer wants the income to help pay for the farm.
Just like farming, when the operator is not able to own all the land they farm, a hunter may not want to own the land they hunt on, but would lease it instead. Leasing recreational land for hunting is an important revenue generator for some landowners that currently is helping offset a portion of the effects of lower farm incomes. For hunters, leasing the land they hunt on is less expensive than buying the land. Farmers National Company's Hunting Lease Network (HLN) provides a leasing service for landowners to expose their recreational property to the market and obtain a fair lease and rent. HLN also requires that proper insurance coverages are in place for the landowner so that they have liability protection.
Fall is a great time of year for both production agriculture and hunters. Both depend on land, albeit for different purposes. Landowners need to be aware of the highest and best use for their land and how to capture the most optimal income stream for the type of land involved. For some land, that means it is best suited for recreation that can be for personal use or to generate income. As with any land, the owner of recreational land needs to know their land and the market whether they are buying, selling, or leasing.
Farmers National Company is auctioning over 5,140 acres from now until the end of the month.
Senior Vice President - Real Estate Operations
|Category: Agricultural Real Estate News|