The first step is to have a conversation with US or your local Lender before you start looking for a farm. Most people prefer to start shopping before they obtain a preapproval, but this can lead to heartbreak and a lot of wasted effort.
Sellers also tend to take you more seriously if you have a preapproval letter in hand. Don’t make classic first-time-buyer mistake of spending hours combing the real estate sites salivating over gorgeous properties with tip-top fencing, palatial houses, and plenty of pasture. (And, of course, 80 acres was the minimum acreage you were willing to consider and later find out you can’t afford it.)
Once completing the loan approval process, it may be sobering to see the size and type of farm that you could realistically afford. Most properties in your budget may be raw land without fence or a place to live, and the places that have close to the 80 acres are at least 40 minutes from town where you work daily. Your search filters may change quickly.
Bringing a neutral party with farming experience and no financial stake in the game can help keep you grounded because it’s easy to fall in love with a farm after the first showing. Viewing as many farms as possible is a tedious process, but the more farms you explore, the more you will learn just how many factors you need to assess in determining whether that piece of land will work for you.
When buying a farm, you need to evaluate its resources: soil, forages, and how they’ve been managed. Taking the topography of the land into account is also important, such as the amount of open pasture vs. wooded acreage. Soil health and fertility are of the utmost importance.
Unlike buying a residential home on a quarter-acre lot in a suburb, farmland comes with exponentially more considerations and potential obstacles. Here are several examples.
- How much will it cost to connect utilities?
- Is there a working well on the property?
- Does it have the access roads you will need?
- What kind of fencing will you need?
- Does it have a barn or other structures you will need?
- How far away from a town are you willing to live?
- How much land can you afford to clear and maintain?
A few weeks, you may catch yourself passing on or reviewing a listing you had ignored many times before. It may just be the 24 acres, which was small by your standards, and mostly woods. The house was gorgeous, but the idea of only being able to run goats and a few head of cattle was an initial disappointment.
You may find the next time you visited a property you’ll stop looking at all the reasons it wasn’t what you wanted and instead considered all the ways you could transform it over the next five to 10 years. (It already has a few acres of pasture and what’s better for clearing woods than goats?)
As thrilling as it is to fantasize about your first farm purchase, it’s important to stay grounded and to have realistic expectations. Most importantly, there’s always going to be another farm.