Joined: Jan 06, 2012
Location: Midwest - Zone 5B
Hello! Long time lurker, 1st time poster.
I'm hoping to get some feedback from those of you that own your land as to what a reasonable price per acre is in today's real estate market. I understand that this is a loaded question and there are a million and one variables that impact value (i.e. location, existing buildings, tillable land/forest, water/gas/electricity availability, etc), but specifically, I'm looking at SW Michigan about as far north as Grand Rapids. I've come across some vastly differing results.
I've found prices going anywhere from $3,500/acre for a property w/ a 3br, 2 bath manufactured home, pond, mix of pasture/woods, to a piece of property that works out to $6,800/acre with no house, but a decent looking pole barn (almost twice as expensive/acre). I'm still a few years away from pulling the trigger on the purchase, but for purposes of trying to budget/compare property prices, is $4,500-$5,000/acre a reasonable range?
For those of you that live outside the region & would like to chime in, please feel free to provide your location, price/acre, when you acquired your property & what prices are going for in your area today. Perhaps I can sway the wife to move to an area outside of SW Michigan.
I have seen 2,500 - 9,000 an acre for undeveloped or cleared land with no structures near me in piedmont NC. I guess it depends upon their motivations. A lot of older articles advocate getting county land maps/stopping by the courthouse and contacting owners of land parcels who are not local who might want to sell but did not previously think that they could. Also, someone who might own 100+ acres might consider breaking off a little chunk of 5-10 acres for a 15-30,000 payday if they are in need of cash. The advantages of taking your time and asking around might get you the piece of land you really want.
Much of it depends on what you plan to do with the land. I recently bought land that was fairly expensive by local standards, but it met my particular needs nicely -- I'm setting up a little farm to market direct to customers, so I needed to be close enough to town that they would be willing to make the trek on a regular basis. Also, I am in the middle of creating what I'm calling an "alley grazing" setup -- alleys of grazing land separated by rows of forest dominated by crop trees and valuable herbs, planted on contour. So for that, I needed a piece of land with a little bit of hilliness and a lot of open space. I'd say that the best way to price shop for land would be to come up with a list of criteria that you feel are important for the land to meet, then go around looking at all the pieces of land that make the grade. That'll give you a distribution of prices to work with, and it will make it easier to determine whether or not the "good deal" is really worthwhile. The land I ended up buying looked expensive until I culled out all the "good deals" that wouldn't have done what I needed them to do. Among the other real potentials, it was actually a pretty decent price.
If you see something that looks like it's almost good enough, try to estimate how much it would cost to bring it up to snuff and add that to the purchase price for comparison purposes.
I also agree with John P's advice, though it didn't end up working in my case (seems like land around here is sold before it's even on the market). I spent two years looking and following leads, just for a point of reference (i.e. you're doing the right thing by not getting in a rush).
Joined: Dec 14, 2011
Location: Andalusia, IL. Zone 5a
Where I live, IL -IA , "rich flat tillable bare farm ground" is bringing $8,000 - $14,000 per acre.
Due to low interest rates, people with money have moved to investing in land rather than houses, making farmers and investors pay more. This will probably create a bubble long term... Especially considering monoculture farming is doomed long term (my opinion). The soil is mostly dead and polluted with chemicals.
The masses of people have not caught on how valuable hilly ground with timber is. It can generally be bought for a lot less, i.e $1000 - $4000 / acre, depending on acres and location.
Look at the years it took to create all that biomass on hilly timber ground. What is the future value of that biomass? In most cases that hilly timber ground biomass ground is not polluted with chemicals. Look at the opportunity for creating edge polycultures on hilly timber ground (ie Sepp Holtzer). Look at opportunity to build Hugelkulture raised garden beds using local on farm debris.
I believe the real value buys still can be had on rough hilly timber ground, before the paradigm shift is made to polycuture from monoculture...
Farmland in Michigan is going for $1500/acre and up. Woodlands in the area you are looking is not any less. I wouldn't budget any less than that. I think the median is maybe $2000/acre in the, truly, rural zones. Toward a big economic center I would think $4000/acre is median.
Joined: Jan 06, 2012
Location: Midwest - Zone 5B
Everybody, thanks for the input.
Ultimately, I'm looking to buy as much land as I can afford, but would like a minimum of 20 acres & a mix of tillable & woods, with the emphasis on the woods. The goal would be to use the property to live a more self-sustaining life by homesteading in the short term and eventually implementing the right systems to create enough of a surplus for local sale.
Monte, those are some crazy numbers in IL. I'm totally on board with your thinking and am definitely gearing my search towards land that has not been strictly cleared & used for conventional farming due to the lack of organic material in the soil & accumulation of chemcial fertilizers and pesticdes. I'm even concerned with buying land NEAR such places because of the runoff of these chemicals into the water ways. I've seen some of the Sepp Holtzer videos that show what is capable in "unconventional" hilly/mountinous areas, so I am definitely looking for some land with "character".
Joined: Jan 06, 2012
Location: Midwest - Zone 5B
Susanna de Villareal-Quintela wrote:Farmland in Michigan is going for $1500/acre and up. Woodlands in the area you are looking is not any less. I wouldn't budget any less than that. I think the median is maybe $2000/acre in the, truly, rural zones. Toward a big economic center I would think $4000/acre is median.
Susanna, have you seen any significant fluctuations in price these past few years in this area?
Intuitively, I would GUESS prices have gone down for rural properties and that they were not completely insulated from the rest of the housing market and economic collapse that much of the country has experienced. On the other hand, I can see the point about investors speculating on such properties, as the metrics of value, supply, and demand are different than say a house in a subdivision outside a major metropolitan area or a condo in a big city.
My goal is to make this happen as soon as practical for my situation, as I think prices for land are inevitably going to go higher. Unfortunately, the timeline for doing so is at least a few years off (but better to be safeR (financially) than sorry).
Susanna de Villareal-Quintela
Joined: May 01, 2010
Of course it depends on the individual tract of land but I have seen a huge shift in prices in my target area. I'm a little north of where you want to be... in Mecosta county. I bought a run-down 3200 sq ft. log cabin on 1.5 acres on a lake. We bought our property for a steal through a forclosrue sale (we were fortunate enough to pay cash). We have spent the past several years breathing life into the old place and keeping our eyes on the real estate market for the upcoming land purchase (we'd like 80 - 160 acres). This area is hilly and has plenty of water... streams, rivers, lakes, etc and a tremendous amount of protected State and Federal land.
The old-timers in the area tell me land prices have fallen almost 50% for the smaller mixed acreage (20-40). The best tillable farmland hasn't moved much... and strong woodlands with harvest at hand or close to harvest are still top dollar. But, like anywhere else, second homes and hunting lands are being let go back to the banks at a staggering frequency. Picking-up the right parcel from a bank is your target if you want the most bang for your buck. These banks are looking to cut bad debt off the books as quick as possible (to improve their balance sheets and their bank rating). I think we have 18 months before we really hit "bottom" and see some stablization in the real estate market.
That's why I'm kinda desperate to see Permies snap these places up. The prices are reachable for many of us and the effect on the community, at large, would be fantastic. SO... the take home message is come on a little north and be my neighbor.
william paulson wrote:I'm hoping to get some feedback from those of you that own your land as to what a reasonable price per acre is in today's real estate market.
This is one of those impossible questions. It varies not just with the region, state, county, town but with the specific property. Some properties are worth (sell for - willing buyer, willing seller) over $1,000,000 per acre while others in the same town might be worth only $500/acre. You really have to have apples to compare with.
That said, our property is valued at about $1,500 per acre by the town assessors. But some acres I've been offered $50,000 per acre (fantastic views, southern exposure, good road, utilities, excellent soils). Others I probably couldn't sell for even $1 (middle of the swamp under the high tension power poles). Good thing I'm not looking to sell.
So, which acre are you asking about? Be very specific. You really have to have apples to compare with.
Then there is the whole question of what you're going to do with it and how much is it worth to you. Selling price only goes so far in 'value' definition.
Joined: Dec 03, 2011
Location: SW Missouri
Wow! I'm thinking maybe we have really low land prices in my neck of the woods. (SW Missouri) Around here you can still get land for about $500 to $1000 per acre. If it goes up to $2000 you know it is good bottomland or has something on it. The best bet -- no matter where you choose to live -- will always be large acreages though. I have noticed a trend for a long while (and believe me I have looked at a lot of land in a lot of places -- including other countries). The trend is that the smaller the parcel the higher the price. Seems ridiculous to me, but for some reason, people do not want to invest in large properties, but would rather settle for some dinky little lot in a city. You should also look for what everyone refers to as "unimproved" land (meaning as Nature made it without the electricity, sewers, phones, wells, etc. that people always assume they need). In my opinion, that is the best sort, but to each his own. I would rather pay $500 per acre for 100 or more than 10 times that amount for a postage stamp sized city lot with all the amenities!
By the way, we paid $400 per acre for our place 20 years ago and we abut Mark Twain National Forest for the entire 1/2 mile border on our east side. Which means, we really have a great big piece of land to enjoy and only had to pay for 75 acres of it. What's more, we can walk to Bull Shoals lake and even see it from the top of the hill. Not a bad investment.