Author Topic: Raw Land: Investment & Advice  (Read 846 times)

maz_phil

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Raw Land: Investment & Advice
« on: June 08, 2018, 12:42:20 PM »
Hey Mustachian Community,

I have been a fan of the podcasts for a while, but now have a question of my own:

I owned a parcel of raw-undeveloped land, about 200 acres, in South Texas and have "sat" on it for about 12 years now. This land has been with my family for generations so I would ideally not like to sell it; the taxes on the property are marginal, about $180/year and there are no fees or loans weighing me down on the property. I find myself wanting to find some means by which to grow some sort of income from this property but have encountered a few issues.

1. I live about 11 hours away from the property, so accessibility and visitation frequency is limited.
2. The property is not near any major towns or even decently sized cities so there is no real prospectus for a substantial increase in land value over time.
3. The property gets less than 20 inches of rainfall a year, and while there is some water on the property, leasing the land to farmers will likely prove difficult.
4. The property has access roads but is far enough away from transmission lines that solar or wind farming is inefficient and not cost-effective.

Pros:
1. I own the land
2. It has wildlife and some regional, arid, vegetation
3. Access roads

I am not looking to become a farmer as the area is not only non-ideal, but also the cost of entry for such a livelihood is prohibitive. I feel that I am likely wasting the potential of this property through my own inexperience with raw land. If in the Mustachian-World has advice, it would be greatly appreciated.

waltworks

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Re: Raw Land: Investment & Advice
« Reply #1 on: June 09, 2018, 10:03:42 AM »
It sounds like it's worthless scrub land. Hence the $180/year taxes.

Unless there are minerals/oil to extract, there's no real way to make money on it, I'd say. Why did your family acquire it in the first place?

-W

gliderpilot567

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Re: Raw Land: Investment & Advice
« Reply #2 on: June 09, 2018, 10:36:19 AM »
Any ranches adjacent? You may be able to make a few bucks on grazing leases, if really all it has is scrub.


AaronMN

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Re: Raw Land: Investment & Advice
« Reply #3 on: June 09, 2018, 01:40:09 PM »
Hunting lease. You could potentially earn a few K per year.

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Fishindude

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Re: Raw Land: Investment & Advice
« Reply #4 on: June 09, 2018, 02:41:56 PM »
Hunting lease or grazing would be all I could recommend also.

gwhunter

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Re: Raw Land: Investment & Advice
« Reply #5 on: June 09, 2018, 07:41:35 PM »
Hunting lease. You could potentially earn a few K per year.


Another vote for this suggestion. 

TheWifeHalf

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Re: Raw Land: Investment & Advice
« Reply #6 on: June 09, 2018, 08:32:35 PM »

4. The property has access roads but is far enough away from transmission lines that solar or wind farming is inefficient and not cost-effective.

Sounds like hunting is the answer!

However, it reminds me of a steel mill THH and I pass every year on the way to a quilt show, and the story he tells:

It's in the middle of nothing, some farm fields (plenty of rain, rich farm land). They, whoever they is, wanted to build a steel mill in the middle of nowhere. The nearest city ran 40 MILES of water pipe so they would have water. It required high voltage electricity so they built what I call 'those huge electric towers' to get electricity from the grid (THH did not know where the grid is in relation to the new mil)  He said there was a big fight with the turnpike over their right of way, and said he didn't know how it was resolved, but the towers are on the right of way!

This was about 25 years ago

I guess if the right business want to locate somewhere, utilities will find a way.

Michael in ABQ

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Re: Raw Land: Investment & Advice
« Reply #7 on: June 09, 2018, 09:02:51 PM »
I'm not sure what part of Texas but I'm familiar with rural land prices in New Mexico. For property around that size in the eastern portion of NM (similar to West Texas) you're looking at maybe $300 - 500 per acre. Grazing leases are a pittance because frankly 200 acres of scrub land can only support a few cattle.

Highest and best use sounds like recreation (i.e. hunting) or selling it to a neighboring for ranch use.

GrayGhost

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Re: Raw Land: Investment & Advice
« Reply #8 on: June 15, 2018, 03:29:36 AM »
At the moment, it's an idle asset. Sure, it's romantic to own land and it is great that your parents have handed it down to you, but practically, it's not doing you or anyone much good at all.

I would say, look at ways to make it an income-producing asset, and if it's not worth the trouble or it doesn't bring in enough money to make the venture worthwhile, divest.

FallenTimber

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Re: Raw Land: Investment & Advice
« Reply #9 on: June 19, 2018, 07:08:15 AM »
Another vote for hunting lease.

Alternatively, you could look at listing on HipCamp.com to cover at least your taxes on the land.