Louis Pompeo
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Leased Acreage
- Thread starter Susie Seibert
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PropertyEconomics
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No but the lease could be strong evidence it is truly an agricultural property, and that was the issue of this thread.
Abester
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Could be, but may not necessarily be. I have known many people who leased 1/2 acre, 5 acres or 10 acres at the back of their lots (and adjoining the farmer's fields) who simply did not want to mow that extra area.
PropertyEconomics
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We are in agreement ... the OP was a bit different. I think it has borne out that the lender did not want to lend on agricultural property. That is there choice based upon the accurate and adequate information provided to them by the appraiser.
Michigan CG
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I think the OP might want to do a little more research, or at least I would. 56 acres in my neck of the woods can have varying degrees of value. Much of it is based on productivity, or a lease (which is again based on productivity).
The OP mentioned beans and corn. 56 acres that produces 25 bu of beans or 110 bu of corn is not going to have significant value, especially if it is not contiguous to the other land the lessee farms.
If it is tiled, and puts out 50 bu beans and 210 bu corn then you have some value.
I have seen leased corn fields at $80/acre and also at $200/acre. I talked to an ASFMRA guy in south mid-Michigan and there are potato fields getting $400/acre lease rates.
What I am saying, if there is a McMansion on the land and the land is leased to a farmer for farming but the guy only pays $80/acre for 50 acres the farm land might have a value of less than $100,000 while the improvements might have values in excess of $500,000.
The OP mentioned beans and corn. 56 acres that produces 25 bu of beans or 110 bu of corn is not going to have significant value, especially if it is not contiguous to the other land the lessee farms.
If it is tiled, and puts out 50 bu beans and 210 bu corn then you have some value.
I have seen leased corn fields at $80/acre and also at $200/acre. I talked to an ASFMRA guy in south mid-Michigan and there are potato fields getting $400/acre lease rates.
What I am saying, if there is a McMansion on the land and the land is leased to a farmer for farming but the guy only pays $80/acre for 50 acres the farm land might have a value of less than $100,000 while the improvements might have values in excess of $500,000.
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