Determining Land Value.....

[leboeuf]

This may be off topic, but I am trying to put a value on a piece of property that I am interested in purchasing and putting cattle on. I have had several real estate agents pull comps of the area, however nothing is within a 10 mile radius or has the same issues (flood plane, high voltage power lines adjacent and thru the length of 1 border, no maintenance for 10+ years). The current land owner is pricing the property as if these issues don't exist.....

Anyone have any websites or advise to better educate a seller and buyer.

thanks

 

[Mahoney Pursley Ranch]

How much are they asking per acre?

 

[leboeuf]

He has not listed it with an agent as of yet. He has had 2 realtors come out, and based on their advice he thinks its worth $4800 per acre. He is willing to sell it to me for $4200 without using realtors. I don't beleive the land is worth more than $3500 since 98% of it is in flood planes. He inheritated the land and wants the cash to go back to the city and live the high life.....

 

[Mahoney Pursley Ranch]

He has not listed it with an agent as of yet. He has had 2 realtors come out, and based on their advice he thinks its worth $4800 per acre. He is willing to sell it to me for $4200 without using realtors. I don't beleive the land is worth more than $3500 since 98% of it is in flood planes. He inheritated the land and wants the cash to go back to the city and live the high life.....

Come on down to Navarro County,I'm in the process of purchasing about 90 adjoining acres with none of the things on the land your looking at for $1500 per acre. ;-)

 

[bird dog]

Are there minerals involved? I agree Mahoney. We bought a real nice place last year in navarro county but we paid a little more, $1750/ac for 84 ac. A little far out of the metroplex but for a me a pleasant drive.

 

[Mahoney Pursley Ranch]

Are there minerals involved? I agree Mahoney. We bought a real nice place last year in navarro county but we paid a little more, $1750/ac for 84 ac. A little far out of the metroplex but for a me a pleasant drive.

The mineral rights will convey on the land we are buying. Has a huge stock tank on the land also but needs alot of fence work and of course the never ending mesquite clearing. :roll:

 

[hillrancher]

He has not listed it with an agent as of yet. He has had 2 realtors come out, and based on their advice he thinks its worth $4800 per acre. He is willing to sell it to me for $4200 without using realtors. I don't beleive the land is worth more than $3500 since 98% of it is in flood planes. He inheritated the land and wants the cash to go back to the city and live the high life.....

He has no ties or love for the land make an offer that you can live with and wait. This is the best approach I have found in these situations.

 

[leboeuf]

there no mineral rights with the land....

Thanks for the input guys, I'll make an offer I can live with and let it be.

 

[Engler]

What is the ground worth in good condition? Good fence, water, cleared, ect.

Now how much money is it going to take to build fence, get water where it needs to be.....

The difference is top dollar that it's worth. But don't forget to figure in time, labor and other "free" things that you could/would be putting into the project.

 

[Mahoney Pursley Ranch]

I'd have second thoughts on buying any land without the mineral rights. You realize that if the seller retains the mineral rights you could end up with a gas or oil line run through the property or worse.

 

[leboeuf]

I have a realtor in the family and have spoken to 2 different title companies in my quest to buy a larger parcel of land. 99% of the deals that are closing in this region (and most others) do not include mineral rights. They are very rare to come by- period.
The acreage we already have has the mineral rights and if we decided to sell the land, we would keep the gas and oil checks. It would still sell for top dollar.

 

[bird dog]

I'd have second thoughts on buying any land without the mineral rights. You realize that if the seller retains the mineral rights you could end up with a gas or oil line run through the property or worse.

I am sorry to say but even if you own the mineral rights it is very hard to fight having a pipeline cross your property. They use the old eminet domain {sp?} deal. The best thing to do is try to extract as much cash as you can and get them to run it down the property line or fence line.
good luck

 

[TheBullLady]

Ahhhhheeemmmm Not ALL Realtors will price property high to secure the listing! Any Realtor that has been in the business, and expects to actually make $$ at it, knows that if you don't sell the property, you don't get paid. So subsequently, if you have 10 overpriced listings in your possession that will never sell, your cattle are going to starve!

If you want a value, talk to your lender! He can tell you exactly what he is willing to lend on the property. Take that to the property owner.

 

[TexasBred]

Lenders have no idea what property is worth until a hired appraiser goes out and completes an appraisal on the property which ordinarily is done from the approach of what similiar properties in fairly close proximity to your property have sold for under normal market conditions. Unless you're just way off base the realtor will list it for what you tell him to list it for. You can always come down but you can't go up. That's why it's often referred to as the "asking price". I never want to sell a property too quickly. If I did I'd always wonder if I priced it too cheap.

 

[Mahoney Pursley Ranch]

I'd have second thoughts on buying any land without the mineral rights. You realize that if the seller retains the mineral rights you could end up with a gas or oil line run through the property or worse.

I am sorry to say but even if you own the mineral rights it is very hard to fight having a pipeline cross your property. They use the old eminet domain {sp?} deal. The best thing to do is try to extract as much cash as you can and get them to run it down the property line or fence line.
good luck

I'm not 100% sure but I believe only the Feds,State,County or City can claim eminent domain,not a private enterprise like a gas or oil company. But a seller retaining mineral rights on the land he sold can sure as heck allow lines to run through the property if he choses to.

 

[jfont]

He has not listed it with an agent as of yet. He has had 2 realtors come out, and based on their advice he thinks its worth $4800 per acre. He is willing to sell it to me for $4200 without using realtors. I don't beleive the land is worth more than $3500 since 98% of it is in flood planes. He inheritated the land and wants the cash to go back to the city and live the high life.....

At $4800 or $3500 per acre, consider how many calves you'd have to sell, and how many years it would take to ever profit from the deal.

 

[novatech]

I'd have second thoughts on buying any land without the mineral rights. You realize that if the seller retains the mineral rights you could end up with a gas or oil line run through the property or worse.

I am sorry to say but even if you own the mineral rights it is very hard to fight having a pipeline cross your property. They use the old eminet domain {sp?} deal. The best thing to do is try to extract as much cash as you can and get them to run it down the property line or fence line.
good luck

I'm not 100% sure but I believe only the Feds,State,County or City can claim eminent domain,not a private enterprise like a gas or oil company. But a seller retaining mineral rights on the land he sold can sure as heck allow lines to run through the property if he choses to.

Bird dog is right . Been down that road.
If you ever want to divide up the property and put a road across it, the pipeline co. will charge big buck for the privilege.

 

[TexasBred]

Oil and gas companies cannot use eminent domain, however, pipeline companies are different and can definitely use it in Texas. However, they would be dealing with the surface owner and not the mineral owner to either obtain an easement for their pipeline or use eminent domain. We just had one put across out place and you don't even know it's there except for the painted post at each end of the property. And they paid us $32 a running foot for the easement, planted grass over all the ground they disturbed and installed a couple of new gates.

 

[Beef11]

That would be a sweet plum if they crossed about 20 sections of your place.

 

[Jogeephus]

Simplest way to determine the land value is to divide the annual net income you can make from the property by an interest rate. For instance, if you can net $80 per acre each year then divide this by 6% - this will yield a land value of $1333/acre. Essentially, this tells you you can make the land pay for itself with your venture if you can maintain this net return. However, people don't look at it this way anymore and the fair price is more likely determined by what some fool is willing to bid at auction + 10% buyers premium + survey fees + legal. Never thought I'd see people paying $3500/acre for swampland - but some people do.