Making land more affordable

[westonwhitetail]

I am casually looking for a larger piece of land for hunting and habitat improvements. If I found the right piece, that I could make some income off to offset the cost, I'd buy it. So I'm wonderig if anyone is willing to share how they have made income off their property? I'm looking for things that you can do yearly, unlike logging. If you're willing to share what you have done and a general income you get thatd be appreciated too. Any info you share is to help me run the numbers when I look at properties. Some ideas I have are below. Thanks in advance for any input.

CRP - Get paid for CRP plantings. Cost per acre is unknown to me. I am in Wisconsin. Pros and cons?

Rent Ag Land - Western Wisconsin cost per acre?

Tapping Maple Trees - I know a few that do that in my area. People are getting paid 25 cents per gallon for just the sap and with the right piece you can make a lot on a good year.

Selling pumpkins or sweet corn - Some work involved here, but it would kind of be a hobby and hope to make a profit to put back into the land. \

Wetland Mitigation - There is a program in WI to get paid to reestablish wetlands that have been drained. As far as I know it takes a lot of legwork to get approved to do this though and there are costs for construction/seeding etc.

 

[bwoods11]

I personally like to buy 50/50 farms with half being income...from tillable or CRP. Some logging can be done. I do not get involved in small projects, but you could certainly grow sweet corn on good soils, and make some money?

 

[Boll Weevil]

You've got a good start! It really does require looking at a particular property's income potential with a discriminating eye beforehand like you're doing. Otherwise there seems to be a greater risk of not realizing the expected returns in the future. Also, don't underestimate State and/or Federal funding programs and grants to add meaningful income.

I receive income from renting tillable ground, cattle pasture (that's converting to tillable this year), hardwood timber, various ages of planted pine with more frequent cash flows, and conservation + habitat management assistance. This year we started finishing/selling stumps as trendy end-tables and interior accents. I couldn't believe what they were selling for in some of the upscale home decor stores.

 

[Catscratch]

Lease it out to hunters. :)

 

[Telemark]

What about burl?

Is it worth anything substantial? Can you cause trees to make it?

 

[H20fwler]

I put a chunk of mine into the Wetland Reserve Program. It involved a lot of legwork but in the end was in line with exactly what I wanted to do with the property anyway and was very profitable.

 

[j-bird]

What I have seen and you need to consider is that land you can make some decent income off of tends to be taxed accordingly. At least in my area. Ground that can be farmed or rented to a farmer will receive a higher assessment value by the local assessor's office. So, that being said - keep that in mind when you start looking. In my case the land was purchased with hunting as an after thought. As such of my 150 acres......I currently have about 100 tillable. I have implemented some CRP areas where it makes sense and I receive payments that will rival my rental rate I receive for the tillable land. Right now on my place I am getting roughly $200/acre in land rental for the tillable acres. The CRP acres are a nice way to build habitat while not giving up the $ to do it.....however it is limited in what you can enroll AND there are rules! There are some government programs as well (here they call it a classified forest program) where again the state government has rules and the like with what you can do to the area enrolled, but they also reduce your "habitat" ground to a tax rate of 1$ an acre. Also keep in mind that these programs stay with the land so it can reduce potential buyers if you are to ever try to sell AND getting out of those programs tends to carry heavy fines and the like as well. Many of these programs change from state to state so your area may be VERY different.

Trying to make money off a property to help put the property purchase in reach is great, but nothing is free and the government has figured out a way to tax everything and those that are not taxed are illegal! You want to make a few bucks then leasing it for someone to hunt a species you don't you could consider. Farming - grazing or row crops - takes valuable acres out of your control and may if your lucky cover your property taxes and then a bit more....maybe. Timbering is a 20 year event if you have something decent to start with and your not going to get rich cutting firewood or tapping maple trees for the most part. You want to get a property to pay for itself.....you better find oil, coal or gold or the like and then sell high and run like hell!

Good luck in your search, but many folks are out there looking for a way to turn a buck off of property.

 

[mtholton]

I have land in WC WI. To J-birds point, each one of my parcels is split between ag and woods. As such, my woods are zoned as ag woods at a much lower rate vs rec land in wi. If I had just bought rec land with no tillable, I think my taxes would be about 3x what they are...

 

[Northbound]

I wish I knew how to estimate timber values by walking around. I envy those with that skill. I'd buy alot more land if I knew it had timber value.

If tillable is in the budget I'd try to find a chunk with both tillable and woods as was mentioned. I'm eastern Wisconsin and have been offered 250/acre to lease out tillable ground to a mega farm. I decide to lease to a young local farmer @130/acre instead. I didn't want to deal with semis of liquid manure and the mess of big farmer. Plus the little guy agrees to leave some corners for wildlife.

Taxes in Wisconsin are stupid cheap on ag land imo. if your parcel has both woods and ag, the woods will also be taxed at a lower "ag forest" rate rather than the high "productive forest" rate that they even sock onto swamps that don't produce anything of value.

Edit Just saw Mtholton made same point, I'm a slow typer

 

[yoderjac]

Planted pine income very compatible with habitat management in my area. Land for pines is less expensive than prime ag land to start with. Rotational timber management keeps a porting in early succession which is great for deer. Pines take many years to produce income so your LLC passes through losses for many years without raising issues with the IRS like many businesses do. Working with the state forester, developing a forest stewardship plan, and even becoming certified all help as well. If you buy land with standing pines, you cut that time to producing the first income significantly.

The downside is that deer are built by dirt and marginal soils will never produce the same classes of deer as prime soils.

Thanks,

Jakc

 

[SoInHunter]

I think you are overlooking the cash flow available from logging.
I met with a private forester at my ground before I made an offer. He gave me an estimate a few days later. My part on logging was estimated to be 30-40% of the amount I was planning on offering. Made my decision easy. I purchased about a year ago and plan to log next year. That log money will make my payment and all expenses for years. I may end up only logging 25% of it every couple years to help with cash flow over an extended period of time. Honestly I would not have purchased without the timber value.

 

[bowhunternw]

I will say that prices seem to match the income potential. At least around here, if you have some good tillable ground then it will cost you a lot more up front. The USDA programs are out there but are never guaranteed, so it is hard to count on them. If you live in the right area maybe you could designate a portion to a solar lease or wind tower?

 

[bowhunternw]

Logging income is very site specific. For instance around here it is about worthless. IMO

 

[Bszweda]

What does timber return on average per acre if you average it out over twenty years?

 

[yoderjac]

What does timber return on average per acre if you average it out over twenty years?

Not an easy question to answer. First, there are different strategies. Some folks plant pines for paper. Depending on prices, the short cycle can generate more income over time than pole timber or saw logs. Pine prices are different than hardwoods. Prices vary sharply with demand. They also vary with site. How much acreage you have amortizes equipment transport cost for the logger. Distance from the mill and the prices of diesel have a big effect as transport is a cost factor. I don't think I could even venture a guess.

We don't look at timber a income. We look at it as a habitat management technique that if done smartly can benefit both wildlife and provide enough income to offset other management costs.

Thanks,

Jack

 

[buckdeer1]

What I did was by accident sort of I had bought a triplex for a good rate and then a farmer that owned some timber along the river decided he would sell so I combined the 65 acres and triplex on one loan and triplex made payment plus insurance and taxes on both and has been that way for 20 years and now I am up to 260 acres and it cost me about 1000 out of pocket plus repairs I have to do.Your local USDA office should be able to give you average CRP rates and state forester should be able to walk your land and give value.In Kansas our ag land taxes are cheap but if you have timber that has no cropping history they can hang you for recreational land which is thousands you can change this by selling timber or firewood and it gives it cropping history.Don't know if all states are the same

 

[chickenlittle]

Timber is something I think you really need to educate yourself on and start looking at state forestry resources and woodland owners association information. In NY and PA, many wood lots have already been high graded and there isn't much there for future saw logs. If it does have some timber, most people want that income now instead of waiting for a bigger payoff a few decades from now. They sell off the best trees that have grown the fastest and have the best genetics for their property. They sign up for a diameter limit cut or high grading select cut and it becomes a 1 or 2 time outflow of cash and leaves the woods degraded for future timber sales. Beyond that, many have noted the difficulty of getting loggers to do the things that would be best for both deer and timber value, a TSI thinning of low grade trees or clear cut in smaller blocks over time.

If you can get a high graded woodlot priced right at purchase, it does give you a blank slate for remaking it as deer hunting paradise without worrying about timber sales. But the seller rarely knows the value of their timber either.

 

[jackpine]

I wish I knew how to estimate timber values by walking around. I envy those with that skill. I'd buy alot more land if I knew it had timber value.

If tillable is in the budget I'd try to find a chunk with both tillable and woods as was mentioned. I'm eastern Wisconsin and have been offered 250/acre to lease out tillable ground to a mega farm. I decide to lease to a young local farmer @130/acre instead. I didn't want to deal with semis of liquid manure and the mess of big farmer. Plus the little guy agrees to leave some corners for wildlife.

Taxes in Wisconsin are stupid cheap on ag land imo. if your parcel has both woods and ag, the woods will also be taxed at a lower "ag forest" rate rather than the high "productive forest" rate that they even sock onto swamps that don't produce anything of value.

Edit Just saw Mtholton made same point, I'm a slow typer

I was just wondering about this after researching a 100ac parcel listed for sale here in WI. The listing said the taxes were approx $3600/yr which seemed high compared to what I see on other listings. I looked on the counties gis website and confirmed the amount and noticed it classif as productive forest. The taxes were $1700/yr on a 40. Right across the street the 40 was $250/yr classif as agricultural forest. Both 40s are solid timber from the looks of the Google aerial view. So why would somebody keep paying the high rate? Does it have to be in a program for it to be ag and the guy doesn't want the state calling any shots on his land?

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[Don'tWorryIHuggedItFirst]

In wi ag forest land is assessed at exactly 1/2 productive forest land.

I would definitely want some ag land to at least pay for the taxes, plus you need to have some ag land in a 40 to get it classified ag forest, unless it's used as a sugar bush.

 

[Northbound]

Yeah that's the big down fall when guys parcel the woods off of a farm. Then it jumps into what I consider ridiculous tax rates for 'productive forest'. Not sure what percentage of land needs to be ag to have the woods considered ag forest.

I'll admit maybe we are under taxed on ag land in Wisconsin, after all its pretty decent income producer (once it's paid off)