Farmland – The days when farmland was just managed by its owners and farmers are far from over. In today’s times, the ownership of farmland is rapidly changing hands and very fast.
According to available statistics, the land market that gained momentum in late 2021, accelerated in 2022 and is seen as a good land investment option in 2023 is driven by competition for high-quality cropland.
This has resulted in record sales and an exceptional increase in the value of these lots across America.
After the launch of Growth Farm Investors in 1981 by Frederick Gale and Clifford Ganschow, the project is termed to be highly successful around 40-plus years later as the total estimated revenue of farmlands is expected to surpass a projected value of 10 million dollars.
When it comes to assets, farmland is looked at as the best possible solution in the real estate industry as it is known to outperform other asset categories. Read this entire article to know why farmland is a good investment in 2023!
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Is Farmland A Good Investment In 2023?
A seasoned investor would always jump on the opportunity of investment and would like to have it in his portfolio to make it big and diverse.
If you are someone who is vying for the option of whether farmland is a good investment in 2023, the answer is YES!!
According to industry experts, land investment is a crucial type of investment any investor would like to have under his belt because of its depleting options.
As we move towards an urbanized world, farmland investment is a good option in developed nations like America.
Since the demand-supply gap of available farmlands in the US is very acute, this agricultural land is bound to give you high returns. This near-constant pressure is a big factor that ensures price support over time to land investors.
Furthermore, land investment is diversely proportional to the high inflation rate. The logic is simple when the food prices escalate, the farmland owner can simply put a board of surge in prices on his farming products and also have a rise in the price of the lot he owns, meaning double profits under his name!
The reasons why you should think of investing in farmland in America in 2023 are –
- The land is a Tangible Asset!
- Land investments are usually less competitive
- Available farmland is already short in supply
- Owning a spacious lot gives ultimate satisfaction and peace of mind to the owner!
- This investment does not have risky government legislation and comes under previously well-defined rules
- Land investment requires minimal effort maintenance as you need not shell out money for a mortgage, utility bills, maintenance and replacements
- Guarantees safe money growth for the owner
- Provides financial security to the owner
- No need to hire lawyers or legal practitioner services to meet specific government requirements as in the business or professional world
Farmland investing refers to the idea that you as a buyer are making an investment that is relevant to crop production.
In the end, this land becomes your real estate property and is often seen as a lucrative investment opportunity by individuals who share the same interest.
When it comes to hard assets, a farmland investment gives multiple benefits to the owner because of its ability to generate wealth. The owner can make use of this land property for
- Crop share income
- Energy farming
- Increasing the price of land over time
- Getting tax credits or subsidies in annual income tax form
As per USDA reports available in 2021, there are 895 million acres of farmland present in the United States. If you are still wondering whether to place the bet on land investment in 2023, you should read the following article –
Final thought Farmland Investment in 2023
It is clear now that investing in farmland can be seen as an excellent choice to increase your number of investments and passive income for 2023, as the market volatility is here to stay for a few years. When you decide to invest in a lot, this is only the first step of a long procedure.
Once you have made up your mind, the next questions related to the land size, how to find appropriate farmland that suits your budget, and getting farmers to rightly operate the cropland for generating additional income streams would pop up in your mind.
How to Invest In Farmland?
Although several ways are available to invest in farmland in the U.S., the most efficient of them all is direct purchase.
However, before you dip your toes in the water and get tricked by farmland size for a huge amount, you should connect with a well-experienced and trustworthy land investment provider.
The available number of lots for farmland is limited due to rising human encroachment. Here are tips that investment providers recommend for potential buyers to follow if they want to make the most of investing in farmland –
- Act sooner than being late:
As farmland is being viewed as a hot real estate property now, its supply is also quickly dwindling. So, instead of repenting later, it’s better to act NOW! Investing in farmland can protect you from rising inflation and interest rates, and give you a chance to better manage your finances
- Choose the right cropping niche:
As farmland comes with multiple cropping options for the investor, you should select the ones that guarantee a maximum ROI based on your soil quality, climatic conditions and water supply facilities. You can choose to plant permanent crops (vegetables, fruits, almonds, limes and avocados that permanently grow in vines or tres) or opt for row crops that are perennial and need tending as well as harvesting each year. Examples of row crops include soybean, wheat, corn etc. These crops require less cash but also result in lower profits.
- Choose whether you would operate the farmland by yourself or lease it to the farmer:
Having previous farming experience can prove beneficial as then you would look after the cropping in farmland operations by yourself. If you have no idea about it, then leasing it to an experienced farmer is the most suitable option as he would operate it with his knowledge. If you prefer a tenant farmer to manage your farmland then you also need to look into other points such as his accommodation, crop share agreement or cash rental rate. Before you start with the farmland operations with a tenant farmer, sign a written contract!
- Discover your purchase method for farmland investment:
Once you have made up your mind to invest in farmland, decide what is best for your pocket –
- Purchase existing farmland property through a sale-leaseback transaction where the current farmer would continue to operate
- Go for existing farmland but lease the agricultural activities to a new farmer tenant
- Acquire new farmland that has not been agriculturally cultivated and convert it to cropland
- Shop for new farmland that has been a cropping land in the past
Irrespective of which type of farmland you choose to acquire, purchasing quality farmland becomes your first and foremost essential step.
It would assist you, the farmland owner have quality cropping and ensure profitable returns on your investment. To get the correct size and productive farmland, approaching a notable and trustworthy land investment dealer becomes a necessity.
Landsale4U is the right farmland investment provider to contact to get an extensive list of ready-to-sale farmland properties in America at the best, most affordable prices.
Reach out to us for a trustworthy experience and to fulfill your land investment goals!