Nice, high visibility commercial property on Highway 280 in Dadeville. 20 minutes to Auburn and less than 10 minutes to downtown Dadeville. Call for your showing today.
Nice, high visibility commercial property on Highway 280 in Dadeville. 20 minutes to Auburn and less than 10 minutes to downtown Dadeville. Call for your showing today.
When you have looked at a property and asked all of the right questions, there comes a point when you have to make a decision: “Do you want it?”
Sometime ago I had the privilege of meeting with a family to write an offer on a property they really liked. We had looked at the tract several times together. As I sat at their desk and they asked a few more questions of me, the wife turned to the husband and said, “Do you want it?”. I loved the point-blank clarity of the question, and that she asked it. He said “yes” and we penned the offer. We closed not long after.
I have done a disservice to lots of potential land buyers. I never gave them the opportunity to say “Yes, I want this property.” In a previous career, one of my roles was fundraising for a non-profit organization. After my presentation about the work we were doing, I would always look a prospective donor in the eye and ask them if they would join our team by making a contribution.
I am good at this with land owners when securing a listing. I never fail to let an owner know about the positive aspects of their property and that I would like to work with them. Then I ask for the listing. I learned my first month in the land business that there is nothing I, as an agent, can (ethically) say to “sell” a piece of land. A buyer will spend $250,000 only when they are ready. They either like it or they don’t. But many people like a property and never take action on it, when they should at least be given the opportunity to say “yes”.
For potential buyers who may be reading this article, you should be thinking, “When is the right time to ask myself if I want it?” Here are a few questions you must answer first:
Many prospective buyers get paralysis by analysis. They want to know every detail to every question (I am naturally bent this way). But most of us know what we don’t want within 10 seconds of seeing it. As the layers of the onion are peeled back, and everything continues to look good, you have to make a call to move forward. You can always have the agent put in some contingencies in a contract that give you an “out” if something unexpected and undesirable pops up as you continue to peel layers prior to closing.
Once you do your due diligence sufficiently and you are comfortable with the information you have, then comes the point of decision. “Do you want it?” If so, take the steps to make it yours. If not, move on and keep looking.
Written by: Jonathan Goode who is an Accredited Land Consultant (ALC), and is licensed as a land broker with Southeastern Land Group in Alabama and Mississippi. He is also co-host of The Land Show, a weekly radio show and podcast for people that love land.
Good hunting leases might be one of the most difficult assets to find in the Southeast. Almost daily I get a call or message from a local hunter who is working hard to find a good property to lease. I also hear the stories from hunters whose leased land hasn’t turned out to be what they had hoped: the owner clearcut the timber, the lease rates keep going up, or the land gets sold and the lease cancelled, among other complaints. Whenever I bring up owning the land that you hunt, the suggestion is usually met with a reply like “I’d love to! But that down payment. And those monthly payments.” I hear you, but let me work through a real-life example with you of a friend of mine that recently bought some land whose annual mortgage payments are almost equal to what he would have spent annually on a lease.
The key to making this method work is simple: spread the cost of the land over a few people. The greatest challenge most people will have is finding 3-4 trustworthy friends that have the desire and means to partner up for a land purchase. But if you’re lucky enough to have those strong relationships, keep reading for how little your cost can actually be, as well as advice on how to structure the purchase to protect and to be fair to everyone involved.
Jim was like many of the people that I get calls from: looking hard for a lease and frustrated by what seemed like high prices, overcrowded hunt clubs, and not-so-promising future land management scenarios. Quality smaller properties (approx. 100 acres) were going for up to $4,000 per year, and were almost impossible to find close to Tallahassee. At the same time three friends from work were also looking, and each shared the same frustrations. One day Jim ran across a property for sale: 115 acres for $240,000. It was a great sportsman property – it had fields, woods, and a pond – located in an area known for good game flow only 45 minutes from home. He knew there was no way he could afford (nor his wife allow) a purchase of that size, but after running some quick numbers he realized that if he could get his three friends in on the purchase, they’d each be spending about what it would cost if they leased individually every year. The trade-off would be that they would have to share the property, but instead of throwing money away on a lease they would be building equity in a land investment. And they could spread the load of improving the property among the four of them.
The numbers looked like this:
At a purchase price of $240,000 financed for 20 years at 5%, a single buyer would have to put $48,000 down (at a 20% down payment), and then shoulder a monthly payment of $1,267. But if all four of them went in together, the down payment per person was only $12,000, and monthly payments were $317, or only $3,804 per year – less than some of the lease land they were looking at.
Jim and his friends decided the trade-offs were worth it for the opportunity to own their own property and do whatever they want with it, all while growing a land investment. They’ve actually found that it has strengthened those friendships as they’ve partnered to increase the quality of the game on the land, and made the place something greater than it was. 115 acres has been plenty of hunting space for them this season – they agree that you don’t really need hundreds of acres to have a good season, just the right property and group of people.
Like any partnership, the success of a venture is built on trust between the parties and a good legal structure that protects everyone involved. For land purchases of this nature, many professionals recommend that the partners create a Limited Liability Company (LLC) both to protect the individuals involved and to clearly outline the ownership interests and responsibilities of each member. LLCs can be easily created online these days, but for those unfamiliar with the company structure and process, it would be prudent to seek professional advice and assistance.
To recap: if you partner with a few friends, you can invest in hunting land for about the same annual cost as a lease. There are trade-offs to this arrangement, but it works for the right group of people. The keys to success are finding the right partners, finding the right property, and creating the right legal structure to protect everyone involved. Contact your local Land Agent today to talk more about how to make this purchase method work for you and what properties are currently on the market in your area.
Daniel Hautamaki is a Land Agent with Southeastern Land Group. He lives in Tallahassee, FL and serves land buyers and sellers in North Florida, Southeast Alabama, and Southwest Georgia.
“What is the best way to find a rural property that we might want to move to, while we still live several states away?” This was a great question posed to Dave Milton and me from an avid listener of The Land Show. Helen from Maryland said she and her husband want to relocate to about 30-40 acres in Alabama in the coming years, and wanted some insights into how best to locate the farm of their dreams. This article attempts to address a few things you can do to locate that perfect place.
There are a few questions you need to be able to answer to begin your search. This list is not exhaustive, but will get the ball rolling.
Where do you want to live? Do you have a particular city or area that you would like to own property near? If you are moving from out of state, you may be selecting a site based on proximity to an employer, some relatives, or quality medical care. By the same token, you may be wanting to move to a rural setting, but are not confined to a certain city. If that is the case, the next question is important for narrowing your choices.
What do you want to do on your land? Helen’s dream is to own a property where she can have chickens, a few cows, and maybe a pig. She probably wants a good garden spot and a place that will grow some berries and fruit trees. I hear that all of the time, and it resonates with me because my family lives exactly that way. You know the things that are important to you, and sharing those with a local broker will help you identify properties you may want to consider.
Earlier this week a retiring attorney who wants to move back to Alabama contacted me, and said it is important that he and his wife be able to shoot firearms on their property. We have a special new property in Shelby County that has a shooting range as part of the gated community. If the What is more important than the Where, you definitely need to clearly identify and share your objectives for the new property. Knowing what you can and cannot do in a given area will help narrow your search for prospective properties.
What is your budget for the purchase? How much are you willing to spend on your land purchase? This is a number you need to determine BEFORE you start driving around looking at properties. You should also be willing to share your budget with an agent so that they can help you identify properties that are a good fit for you.
If financing is going to be a part of your purchase, ask a broker for information regarding a good land lender. In Alabama, we mainly deal with two great companies that specialize in rural land loans: First South Farm Credit and Alabama Ag Credit. Farm lenders typically require a 15% to 20% down payment, and the interest rates are slightly higher than a residential mortgage. Each of these lenders has several programs that should be able to help you easily make your purchase.
These days, searching for land is easier than ever online. There are some great land listing sites that allow you to find available properties. We use LandsofAmerica, LandWatch, LandandFarm, LandFlip, and of course our own site SELandGroup.com. All of these sites have filters that allow you to narrow or expand your search based on criteria that are important to you. These sites are helpful in getting an idea of what is available, what land prices are for listed properties in an area (notice I didn’t say what it sells for in an area), and who are the brokers that specialize in land in that area.
The best advice I can offer for someone living in a different state that is looking to move is to find a broker you can trust that specializes in helping people buy and sell rural land. There are so many things that you do not know about the laws, customs, and opportunities in unfamiliar territory, that you need a reputable and seasoned guide to help you. You need someone that can help you navigate the potential pitfalls associated with all of your unknowns. Look for brokers with good reviews on social media sites like Facebook or Linkedin, ask for referrals from friends and family, or interview several candidates and choose the one that seems the best fit for you.
There are Realtors that focus on helping people buy and sell land. Many of these brokers belong to the Realtors Land Institute (RLI), which is a trade organization for those among us that focus mainly on brokering land. The most accomplished land brokers are recognized with a designation from RLI, and are known as Accredited Land Consultants (ALC’s). ALC’s have undergone rigorous education and professional examinations before they can earn the designation. These are people that demonstrate knowledge, experience, and professionalism when it comes to land transactions. You can search for RLI members and ALC’s on the Realtors Land Institute website.
Dealing with a broker or agent that you can trust, who specializes in land, will help ensure your land purchase is what you have been dreaming of. Find someone that is competent in land, has a servant’s attitude, and is knowledgeable about the area that you are searching in. That is a recipe for a successful transaction.
I hope this gives you a few steps to get you started in your search for the property you’ve been dreaming of owning. Our experienced team at Southeastern Land Group would love to help you with any of your land buying or selling needs. Please feel free to contact our office at 866-751-LAND, and Jeanne or Susan will put you in touch with the right agent for your needs; or feel free to contact me directly with any specific questions. Thank you for reading, and please Share this article with your friends.
Written by: Jonathan Goode who is an Accredited Land Consultant (ALC), and is passionate about helping people buy and sell land. Jonathan is a licensed broker in Alabama and Mississippi.
“I want to sell my property, what do i need to do?” This is a common question this time of year. Its getting hot, summer is practically here, but i need to sell my property…
Preparation and planning is key to anything. Whether its a sporting event, going on vacation, or planning for your retirement….it is no different with selling land. In order to have a successful listing and selling experience, you have to have a plan from the start. If you fail to plan, you better plan to fail.
Any time someone calls me and says “Ive got some land I want to sell, what do i need to do?” I always respond, “well, you have already completed the first step.” First thing on the list is to call a experienced Land Agent. At Southeastern Land Group we specialize in selling farmland, timberland, recreational properties, investment property, and agricultural land. We have agents living in Alabama, Georgia and Florida that are ready to create results for you. We are licensed to sell in AL, GA, FL, MS, and TN. Every property is unique in its own way, therefore, not every property needs the same preparation before it hits the market.
Historically, late Spring and early summer can sometimes drag a little longer in the time frame it takes to sell property. Does that mean its a bad time to list during the summer? ABSOLUTELY NOT! In fact, its one of the best times to list your property because we have all of the Outdoor Expos, and Outdoor Shows during the summer and its a great opportunity to get you property in front of thousands of eyes that i will not get any other time of year. However, with the knowledge and expertise we bring to the table, we can help you make your property attractive year round. I actually like summer time listings because it gives me a chance to do some things that nobody else does. We can make recommendation that will take your property from being simply “another listing”, to something that is highly sought out, and stands out compared to other properties. We can help you make the right decisions as far as what improvements needs to made, what work (if any) needs to be done, and how to best market your particular property. Sometimes property is turn key and ready to hit the market and if so, thats great. Most improvements are small, low in cost, and can be done rather quickly. However, these small improvements can make a BIG DIFFERENCE when they are side by side with other like kind properties.
Some land owners may ask “How, do you know this will help. And how do you know this is going to draw more attention to my property?” We work with buyers day in, and day out. We listen to what exactly they look for in a property. With the ability to know what a buyer is looking for, and what a seller has to offer is what makes a sales traction process run smooth.
If its time to put your property up for sale, we have a proven track record to help get the job done. Don’t call just any real estate company….consult with the experts that specialize in what you have to sell. We are here to not only help, but to create results.
Remember the “5 Steps to Selling Your Property”
1.) Contact Me
2.) I’ll handle the rest
WRITTEN BY: John Morris, Land Agent
Is it a good idea to divide your rural property to help it sell? That question can only be answered once the landowner determines their objectives, and if the characteristics of the property lend itself to division. Each property should be evaluated on a case by case basis to determine if a division will help the owner make the sell.
Recently I have made recommendations to two different land owners about whether they should offer their properties as a whole or divide them and market them separately. Both tracts share many similar qualities: each has state highway frontage, a cabin, a lake, and they both join the national forest. In my property evaluation and marketing proposal I suggested that one owner divide his property and the other I recommended that he offer it in its entirety.
The decision about whether to offer your property in multiple tracts or to sell it in its entirety should be made based on what your objectives are in selling the property. Is your goal to generate some immediate revenue? Perhaps your goal is to liquidate an asset that is in another state so as to remove all liabilities associated with it. Do you want to get the highest possible price for a property no matter how long it takes, or do you simply want to dissolve a partnership quickly and move on with your life?
Here are some considerations I take into account when advising clients about dividing the tract:
Here is when I would consider dividing the property:
1. If you want to maximize returns on the property and the number of days on the market is not really a consideration.
2. The property is large, and offering smaller parcels increases the potential buyer pool. (Because there are more buyers that can afford a $50,000 tract than a $500,000 property.)
3. You need to generate some revenue quickly, and the odds of selling a small parcel are good.
4. There is a market for mini-farms or small estates that would justify breaking your tract up.
5. An adjoining owner wants a portion of the property and brings a bag of cash.
I would advise against dividing a property for selling it if:
1. One of the divided parcels would be a liability or would be unlikely to sell if the more desirable piece is sold first. (Then you may be stuck with a “dog” forever.) Use the good tract as leverage to make someone buy the undesirable one too.
2. The costs associated with closing a small parcel of land are not justified by the sell price.
3. By dividing your land, the piece you sell adversely affects the property you are going to keep. (ie.. lose road frontage, increased cost to connect to utilities, lose farming capabilities, give up access to a water feature, etc…)
When considering how to divide a property, these are things I generally look for when making a recommendation:
1. Natural divisions such as creeks, canyons, fields, forests, and other topographical features that would make a dividing point?
2. Logical divisions such as roads, fence lines, fire lanes, varying ages of timber stands.
3. Surveyed boundaries
A few other things to consider would include the costs associated with dividing it. A survey can be expensive as well as closing costs and real estate fees. Make sure you examine the estimated net sheet closely before agreeing to divide and sell.
I hope these tips are helpful when considering whether to divide your property or not when putting them on the market. The decision can really only be made based on your objectives and the features of your property. I would welcome the opportunity to discuss your property, and how we may be able to help you get top dollar when the time comes to sell.
Written by: Jonathan Goode who is passionate about helping people buy and sell land. Jonathan is an Accredited Land Consultant (ALC) and a licensed broker in Alabama and Mississippi.
Patrick Jones, owner of Phat Farm Outfitters, in Eutaw, Greene County, Alabama is our special guest on this edition of The Land Show. Patrick recently hosted Dave and Jonathan, as well as Dave’s father, Dr. Jimmy Milton and his son, Josh for some fun bass fishing in his stocked lakes. The group took home over 30 bass and Dr. Milton caught a nice one that went over 7 lbs. (They left the camera in the truck!) Patrick offers guided deer hunts, duck hunts, and some pretty darn good bass fishing.
Robert King shares the benefits of aerial mapping in our Farmland Report. Kyle Ingalls talks about the effects of Canadian timber tariffs on timberland in the Southeast in Timber Talk. John Morris shares a great new property for sale on Pioneer Lake in Shelby County. Tim Baker shares about a recent speaking engagement in Franklin County that meant a lot to him.
Dave filleted the fish, and Jonathan took home the bass fillets to his wife Whitney. Last week they cooked them on the grill, and here is the recipe Johnny used.
The fish were so fresh and moist, it was amazing. Be sure to couple that with some Conecuh sausage as an appetizer and the veggies of your choice. You’ll be glad you did!
By now many of you may have seen the Facebook posts about this beautiful new farm listing in North Florida. If not, you can get all the information on our listing page: selg.biz/8716 (main narrative copied below). As one of the listing agents, I wanted to take a few moments to talk more about my impressions of the property – why I think this is one of the most beautiful properties and best values currently on the market.
I’ve been active in North Florida rural land sales for going on 4 years now, and that time has afforded me many opportunities to explore beautiful properties. Florida is known for its beautiful beach communities and tourist attractions, but it is also home to some of the most exquisitely appointed rural properties in the Southeast. Campbellton Farms is one of these properties. Anyone that has ever driven the US-231 route from Alabama to Panama City would have been hard pressed to ignore this property as they drove past. For nearly two miles along the highway, the passerby is afforded a lovely view of rolling red clay farmland, waving hay pasture, ponds and open hardwood hammocks – not to mention the estate on the hill at the end of a live-oak lined drive. Those that have had the privilege of passing through the wrought-iron entrance gates can speak to the sights, sounds and smells of working farm fields, migratory birds, and an Old World landscape that is quickly disappearing in other parts of the South. Personally, to see this land passed on to a new generation of stewardship would bring me great satisfaction. The current owners have expended far greater funds on protecting, preserving, and improving this great landscape than is reflected in the asking price. This is truly a strong value for a beautiful Southern estate and working farm. I encourage anyone interested to contact us for a tour – we are more than happy to introduce others to this beautiful land.
– Daniel Hautamaki, Land Agent
Below Copied from Listing Page: selg.biz/8716
Campbellton Farms is the most beautiful turn-key agricultural estate and investment available on the market today. The farm is 766 acres of rolling pastureland and cropland, fully fenced, with open hardwood and pine hammocks and ponds, giving the property a unique Old World character. The beauty of the landscape is matched by that of the luxurious 11,000 sq. ft. estate home, which boasts 6 bedrooms/5 baths, a pool, and an abundance of superlative features. A second 2,400 sq. ft. farmhouse, large enclosed metal equipment building, and long list of included machinery finalize this all-inclusive opportunity as one of the best values in high-class country living currently for sale.
Campbellton Farms is 766 acres of highly productive rolling red-clay vistas in one of the most highly sought-after locations in North Florida. The property sits just 20 minutes south of Dothan, AL and less than an hour from Panama City, FL, along U.S. Highway 231 approximately 4 miles south of the Florida/Alabama state line. Of the total acreage, 268 acres are currently leased for hay production, 226 acres are leased for row crops producing peanuts and cotton, and 191 acres are in picturesque Old Florida hardwood hammocks, natural upland pine, and cypress bottomland. The remainder of the acreage is made up of ponds, roads, buildings and landscaping; a full set of maps are available for download in the Attachments section below. The upland soils are nearly all USDA Prime Farmland. Current lease rates are available upon request. The property’s 6-mile perimeter is entirely fenced, making this an ideal option for the horse enthusiast or cattle operator. There are 4 wells on the property providing water for all buildings, as well as irrigation for all landscaping (including the live oak and azalea-lined main drive), and an additional 10 water spigots spread around the property for filling watering troughs, etc. For the sportsman, two ponds are on the land: one 7.5-acre and one 1.5-acre, providing recreational opportunities for fishing and duck hunting, and additional irrigation reservoirs and watering sources. Each pond has a dedicated well and can be filled during dry periods to protect fish populations. The combination of high-quality hay and forage on the property and abundant shelter yield very strong deer and turkey populations. Dove fields could easily be established to increase available recreation options, and some of the upland pine would make for an ideal quail course. In short, there are no limits to the enjoyment that a property of this caliber provides.
The elegance of the surrounding landscape meets its match in the refinement of the primary estate. Built in 2009, the 7,187 square feet of heated and cooled space with 6 bedrooms, 4 full-baths and 2 half-baths provide ample space for visitors and endless options for entertaining. For the best experience, please take our 3D tour of the main house.
Estate features include:
In addition to the luxurious living space, the estate boasts a beautiful heated pool and hot tub with views of the pasture and hardwood hammocks, complete with pool-side terrace and separate pool house, with a finished bedroom and bath, additional poolside kitchen and bar, and storage space. There is a built-on 3-car finished garage, as well as another separate 2-car carport with an enclosed workshop, and enclosed generator room which houses a Cat whole-house diesel generator designed to come on automatically in case of power failure. These structures bring the final covered area to just under 11,000 sq. ft. The estate comes complete with a dedicated security system, and flood-lighting that provides visibility for the grounds around the estate at night. The grounds are fully landscaped, irrigated and manicured, designed to increase in beauty over time.
Separate from the main estate, there is also a 2,400 square foot (heated and cooled) traditional farmhouse on the grounds, built in 2007. It provides 4 more bedrooms and 3 baths for visiting family, a groundskeeper, or as a quaint country rental house to increase property income. The house is very well-kept and move-in ready. It provides views out over the larger pond. It also contains a 2-car garage and landscaped/irrigated grounds.
Campbellton Farms is a truly turn-key investment, and comes with everything you need to maintain the property. Additional improvements to the grounds include a 100’x50′ enclosed metal storage building with office, bathroom, and power. It adds more covered space with a built-on lean-to, and there is another 30’x95′ pole barn nearby. A complete list of equipment included in the sale is available for download in the Attachments section below. Highlights include:
Campbellton Farms is one of the finest properties for sale of any type in the Southeast. Its combination of productivity and luxury create a value picture worthy of consideration by any serious buyer of agricultural estates. In addition to the income production, the nearly 2 miles of Highway 231 frontage and development potential present an opportunity for a conservation easement for anyone interested in tax reduction holdings. Furthermore, the State of Florida does not have an income tax for Florida homesteads and buyers from out of state could potentially see additional tax savings should they move. Add to these investment characteristics the sheer beauty and recreational opportunities, and the compelling case for owning this land is clear. To schedule your tour of Campbellton Farms, please give us a call today.
In order for a seller to command top dollar for the sale of a rural piece of land, a buyer must generally be very certain of what they are purchasing. The degree of certainty, or the comfort level, the buyer has with a given property often directly affects the price they are willing to pay.
“Markets hate uncertainty” is a saying we’ve all heard dozens of times in the past few years. The real estate market is also not averse to the animosity towards uncertainty. In financial terms, uncertainty equals risk.
There are many different types of risk associated with any given property, but I deal with a few that frequently affect a buyer’s interest level:
1. Access– Does the property have road access or at least a deeded access? In Alabama, 95% of the time land lenders will not loan money on a tract that is land-locked. Without legal access, even the lender is not willing to take a risk on a property.
2. Soil types– Buyers I deal with are usually looking for a timberland investment or an agricultural property. They want to know about the suitability of the soils for their intended purpose. Good timberland needs a high site index for the tree species they want to grow, and farmland also needs to be suitable for the purpose of the farmer.
3. Mineral Rights- Does the current owner of the land also own the mineral rights? This matters to many prospective buyers because they want to know if someone will come put an oil derrick in their front yard.
And the list could go on indefinitely.
The purpose of this article is to show that generally the more information you can provide to a potential purchaser up front, the more likely you are to make a sale. In my experience the more risk a property poses to a prospective buyer, the less money they are willing to offer for it. Please see the chart above that I’ve used to illustrate this point: the lower the risk, the higher the sales price, and inversely, the greater the risk, the lower the sales price.
With the exception of institutional and commercial land investors, land investment is usually a matter of personal finance. People buy land. People need good information to buy a piece of property. Generally your average buyer of a small to medium sized property has a fairly low tolerance for risk with their land purchases. They want to be pretty certain about what they are purchasing. The proof of that is that most buyers (I deal with) make sure they have a clear title to a property and get an owner’s title insurance policy for extra peace of mind.
I find it helpful to address negatives about a property early in the process of the buyer making their decision. Hiding it from the prospect only creates ill-will and distrust, and derails many deals before they get a good chance to start.
Sellers and agents will benefit from the maxim: certainty makes the sale. The more good information we can provide to prospective buyers, the greater the likelihood that we can sell them a property.
On the way home from school last Friday, my son JD, asked me “What is wrong with buying a property that already has a conservation easement on it?” You may think that is an odd question for a 12 year old to ask, but around my house we talk about land all the time.
The previous week he had been riding with me in the truck as I was on a Bluetooth phone conversation with a client who was considering a property that already has an easement in place. The client asked me essentially the same thing, “What is the downside to purchasing a property that already has an easement in place?” I answered, “It’s kind of like ordering a milkshake, and someone else gets to drink the milkshake and you get to keep the cup. Somebody else has already gotten all the ‘goodie’ out of it.”
That is an over-simplification of purchasing a property with an easement in place, but it makes the point nicely. As long as the prospective buyer goes into the purchase knowing that he is only getting the cup with no milkshake, then that is acceptable.
Conservation Easements, by design, involve a property owner donating some of the rights associated with their ownership to a land trust or conservation entity in perpetuity, usually in exchange for some tax benefit. These easements are generally binding on a property forever, or at least some protracted amount of time. I am not an attorney, accountant, or tax professional so I will leave it to them to give advice about exactly how an easement would work for your situation.
Here are some suggestions about doing your due diligence on a property you are considering purchasing that already has a conservation easement in place:
1. Ask for a copy of the paperwork associated with the easement donation. You need to know everything you can about what rights were donated and what rights the landowner retained. There are some rights, that when extinguished, may not adversely affect what you would want to do with a particular property. If the rights to develop a subdivision were donated, but you would only want the property for a personal getaway, then it may not be a deal breaker. You may still be able to hunt, fish, or manage the timber and that be acceptable to you.
2. Determine what rights are extinguished and for how long they are extinguished. Conservation easements can involve a seemingly endless amount of rights that can be donated to the land trust. Your ownership rights will certainly be encumbered, you just have to determine to what extent and if you are willing to accept those limitations of your use.
3. What are the penalties associated with failing to adhere to or violating the terms of the easement?
4. Find out who is the land trust that will monitor the easement. A conservation easement is donated to a land trust that will monitor the property on an ongoing basis to ensure compliance with the terms of the donation agreement. It would be prudent before making a purchase on a property to go meet with personnel at the land trust to find out about the process for how they will do their annual audits and site visits. You will want to make sure that you can reasonably get along with the entity that will be monitoring your activity on your property from now on. You are essentially married to the land trust for as long as you own the property.
5. Have an attorney that understands conservation easements review the documentation for you. Conservation easements have many pieces, and it may take some expertise to understand how they all fit together and how that relates to you. Before making a land purchase, get the counsel you need to make the best decision possible.
Properties with conservation easements in place often sell for a price that seems like a bargain. You must understand that what you are purchasing is not the full bundle of rights associated with a typical land purchase. You must spend more time investigating what is included and excluded before you make this type of purchase.
Conservation easements are a great tool to protect a property, help mitigate some of your tax liability, or both. Determine what are the limitations and obligations imposed by the easement and if those are compatible with your ownership objectives. Going into a land purchase of a property with an existing easement with a comprehensive understanding of the property, the easement, the entities involved, and what is expected to maintain compliance is essential to ensuring a positive outcome.
Jonathan Goode is a licensed real estate broker with Southeastern Land Group, serving Alabama and Mississippi. He is an Accredited Land Consultant (ALC), and loves helping people buy or sell rural land.