Should timber value be a factor?

[CANative]

mostly sells veneer for casket products.

Got his number? I just might be in the market.

 

[Mr Rex]

I've been seeing some anomalies here, tracts that have been recently cut over bringing more than crop land or immature timber tracts. The City slicker hunt clubs like the cut over, more deer, turkey, rabbits, quail per acre than forest land and of course open tillable land and are paying a premium price for large tracts. Of course 35 year old+ pine plantations or 70+ year old hardwoods are a different story. So, as others have said, compare apples to apples. Talk to a few timber guys, they can put you on some recent sales that were subsequently cut for timber, and will likely be glad to do an informal cruise for free to have a leg up on the competition if the timber does go up for bid. Just get more than one opinion.

 

[PropertyEconomics]

Once again we learn that not all markets are the same ... the best advice here is to use sales of similar properties .. that woudl work in any market and the value of the timber is reflected in the selling price of similar tracts with similar timber ....

 

[CANative]

Once again we learn that not all markets are the same ... the best advice here is to use sales of similar properties .. that woudl work in any market and the value of the timber is reflected in the selling price of similar tracts with similar timber ....

As long as the highest and best use is not as timberland.

Otherwise it's improper methodology to appraise timberland by considering the land and the timber as a single unit.

 

[PropertyEconomics]

As long as the highest and best use is not as timberland.

Otherwise it's improper methodology to appraise timberland by considering the land and the timber as a single unit.

I believe that not to be true .. DEPENDING on the purpose of the assignment. Comparing to what other Timber parcels sold for would in fact include the value of the timber ... not a sepearate valuation of the timber but I dont believe that was the assignment here. One must pay attention ... :blush:

 

[fifteen]

Highest and best use as timberland would mean the cut timber is worth more than the timber and the site. I can see where timber value can't be added to mv unless it's a commercial valuation - even then the value has to reflect with and without. Find similarly timbered sales is your best hope outside of scaling (cruising) to include the value. Like someone said, residentially find one that's been cut and cleared (including stumps) and one that's timbered. Of course stands of rare woods that are worth more than residential use are automatically referred to a commercial valuation. I find homeowners with marketable timber typically know what it's worth and if it were worth more than the homestead and the land, they'd move (more room for growth) lol. HBU as timberland would usually be a temporary condition - transitory. Have a great weekend :new_all_coholic:

tim·ber·land n. Forested land, especially land containing timber of commercial value

As long as the highest and best use is not as timberland.

Otherwise it's improper methodology to appraise timberland by considering the land and the timber as a single unit.

 

[CANative]

I believe that not to be true ..

I believe you were incorrect in believing what I posted not to be true.

It would be kind of like appraising a 1 acre residential property by using other 1 acre resdential properties without regard for differneces in improvements.

 

[Michigan CG]

Highest and best use as timberland would mean the cut timber is worth more than the timber and the site. ................................HBU as timberland would usually be a temporary condition.

Wrong in both cases.

 

[edward sekerak]

Pa. Timberland Appraisal

1.I would suggest you do not provide the timber value as part your report. You are right to suggest to the owner to have the timber evaluated by a forester or someone in the business. This can be done be either an ACF Forester or someone knowledgable about your local timber market. There are AFC Foresters in Biglerville, Holidaysburg and Kane.

2. You are correct that timber values aren't what they were 2-4 years ago. We saw a substantial drop in hardwood prices from March 2008 to March 2009 alone. However, the price change is not constant for all species, and timber prices fluctuate much more than land values.

3 If the last time it was cut was in the 1950s it may or may not be a good stand. Well managed, some hardwood forests can be selectivly cut every 10 years and enhance the timber stand. Due to the age, species mix, topo. etc. it would be extremely difficult to find similar comparable land sales with similar timber values.

4. If HBU is not "timber growth" use comps of similar size and similar HBU. Typically I adjust for factors such as topography, soils type or class (per USDA/NRCS soil survey), frontage, access, slope, etc. Be sure to consider factors such as streams, pipeline R-O-Ws, eassments which may limit future use or access.

5.Other points to consider: What is the status of the OGM rights? Is the property in thick Marsellus Shale area? Is the property enrolled in "Clean And Green" act 319?

 

[Terrel L. Shields]

I can only speak about Arkansas, but I can say that the first person to lose their license in this state did so by appraising a timberland parcel on a land form. He had a timber cruise..one that botched the calculation by a wide margin.

There are 2 kinds of "timber".. True Timberland and "woodlot". If it produces below a certain theshold, then it is woodlot. In our state foresters have to have an appraisal license to value timber land (as opposed to standing timber) and our appraisers have to have a certified forester. Attempting to value "timberland" by using simple "timberland comps" and you having absolutely no forestry training will cost you your license.

An example of a "botched" appraisal happened when my neighbor bought out a parcel from a landowner from Texas. The landowner sent an E. Texas forester to the site and he declared the value of the timber was minimal and figured in trucking the timber to an E. Texas mill 300 miles away. He was unaware of the market in this area where, at the time, several furniture factories were buying hardwoods for chair frames. The guy bought the place and paid for half of it by timbering the walnut and hardwoods to the furniture guys.

be careful out there. ...and just because you hire a forester does not mean that forester understands the nature of the appraisal problem.