5 Tips for Listing Your Farm or Ranch Propertymarch 1, 2020
Listing your farm or ranch can seem like an intimidating process. If you are a first-time seller or you have sold property in the past, managing the paperwork, phone calls and showings can become more of a job than it was running your ranch. This checklist from Nate Finch, one of our owners here at 18 Land Co., will help make listing your ranch easier.
1. Be selective when choosing a broker
This first step is certainly the most important. You want to work with someone who is well-versed in ranch listings and farm and ranch sales. They should be able to list the value they’ll bring to you specifically. A broker should visit your farm or ranch and present a marketing plan that is personalized and highlights the assets of your land. For example, if you have a year-round herd of elk visiting your property, a broker should market your land as hunting property.Some of the features Montana ranch buyers typically look for might include live water, wildlife habitat, good irrigation water rights, good soil, and a favorable climate for running cattle, so a broker’s marketing plan should highlight any that your property includes.
As Nate points out, it’s easy for first-time sellers to overprice. Montana is a non-disclosure state, so sellers don’t have a way to accurately compare pricing, since sales information is not public information. A good broker will also include insight on how to price your property.
To help you find the right broker, read our previous blog post about realtors versus brokers.
2. Discuss ranch sale tax consequences with a financial professional
Selling ranch and farm land is a different process than selling a house.You’ll need to work with professionals who know tax laws, especially the 1031 Exchange rules. Put simply, this allows a ranch seller to take the proceeds from his sale and purchase another property of like kind in order to defer the capital gains taxes he would have otherwise incurred.
You’ll want to make sure you meet with a tax professional well before a sale is underway to discuss this. If you’re unsure of the right person to meet with, we are happy to refer you to a trusted professional. Contact us for help finding the right professionals to partner with.
3. Be ready for showings
Photography is extremely important to get buyers interested in visiting your ranch or farm land.Your broker should produce high quality photos of the most attractive features of your property as well as videos that showcase your property’s unique value. This will inspire potential buyers to schedule a showing.
Remember that showings can happen anytime.If your property has high-end homes and outbuildings we recommend hiring a cleaning service so these buildings will always look their best. Besides the interior, all land maintenance should be finished. Fences should be repaired. Weeds should be sprayed or mowed.
4. Don’t take any shortcuts on gathering information for potential buyers
We recommend ranch sellers stay organized and gather as much information as possible about your property. Buyers will need to know about water rights, power bills, pasture and field production records and grazing leases. Disclose everything about your property to ensure a smooth sales process.
Ranch sellers should make a record of personal property items that may become part of the transaction. For example, crops that are in storage or in the ground belong to the seller but could be negotiated items. If you have questions about other items that can be negotiated as part of the sale, give us a call at 406.988.0055.
5. Negotiating is key to a sale
Negotiations can be stressful. The purchase price, due diligence items and other terms of the transaction will have to be worked out. Remember, the ultimate goal is to sell your property and there always has to be some give and take.