Farming has been around for almost as long as humans have. Farmland is the oldest form of real estate investment. Over the past couple of centuries, the industry has gone through a lot of technical changes, and that technology is constantly advancing. If you are thinking about buying farmland as an investment, you need to realize that the process is going to take some time. You cannot go into alone, and your typical broker or financial advisor might not be enough.
You really ought to consider hiring professionals who actually know the industry and everything that goes into it, from the weather in the area all the way down to the topsoil, ecology, and irrigation methods. Farmland in one region has different requirements than farmland in another. A farming professional with experience in New England or the Heartland isn’t going to be as knowledgeable of western ranches, and vice versa. Also, terracing in mountainous regions is going to require a different type of professional than a farming expert out in the plains.
There are many benefits of buying farmland as an investment, as long as you work with the right people. You don’t even have to visit the land yourself. You could have a new farm developed and lease some of it out, buy an existing farm and make improvements for profit, etc. There are a variety of possibilities – especially in the US where there is a huge network of rivers, railways, and highways for deliveries and logistics. Plus, there are tax benefits as farmland usually contains some assets that can be depreciated by the owner each year (irrigation pivots, storage, barns, etc.)
Buying Farmland as an Investment in Other Countries
If you are thinking about investing in farm properties in other countries, make sure it’s in a region with a decent road / railway infrastructure and a type of government that is set up in a way that will benefit farm owners.
If you want to go with an organization of experts who have a network of farmers, soil analysts, equipment operators, and other people involved in the farming industry, make sure you choose one that will send you regular updates on your investment. You’ll want to receive key performance indicators on productivity via videos, photos, and interviews.
If you don’t want to own an entire farmland, you can simply become a farmland investor by being an owner in an LLC. This means that you will receive a percentage of the returns depending on how much you are entitled to after becoming a fractional owner.
The best place to get started with buying farmland as an investment is FarmTogether. This organization makes it easy to invest in farmland for those who don’t want to have to do all of the actual farm management work and due diligence involved.