After spending years cultivating your land, you might be ready to move on from farming. Although you might be ready to list your farm land for sale and focus on something new, real estate agents warn that careful considerations are in order to prevent seller’s remorse. Here are three things to consider before listing your farm land for sale, and why a little due diligence will make the process much easier.
3 Things to Consider Before Selling Farmland
Capital Gains Tax
You aren’t the only one looking forward to that windfall from selling a property that has appreciated in value over the years. Unfortunately, you are required to pay capital gains tax to the federal government on the difference that you make on the sale of your land, which is why you should take the time to carefully consider your finances before moving on.
For example, if you have 100 acres that you purchased for $500 an acre in 1960, your original $50,000 investment would yield around $800,000 in a market where land is selling for $8,000 an acre—minus capital gains tax on your $750,000 profit. Since capital gains tax can be as much as 9.9% for farm land in Oregon, having a real estate agent by your side to broker the deal can help you to get a better price on your property, so that you can arrange a profitable deal.
Another important thing to think about is your future. Do you want to keep a portion of your land to pass down to your kids, or are you thinking about investing in your dream home? Since farm land can be difficult to acquire again after it is sold, make sure that you are happy with your decision before listing your property.
Current Interest Rates
Sometimes, farmers decide to list their land for sale to invest in another farm or land parcel. Although doing this can help people to choose land in a more desirable part of the state, interest rates can also vary over time, especially if your credit has changed. Before you list your land, discuss your personal credit score and current interest rates with your financial broker to estimate potential payments.
When you are ready to list your farm land for sale, meet with an agent from Jett Blackburn Real Estate. In addition to helping people throughout Eastern Oregon to broker farm land deals since 1960, this team of professional real estate agents works hard to understand their clients’ needs and to make the transition process stress-free and convenient. To explore current listings or to schedule an appointment with a broker, visit them online or call (541) 573-7206.