Should we buy the property?

[UponStars]

We have an opportunity to purchase approximately 15 acres of wooded land with nearly ¼ mile of it bordering a small river.  It would cost $1000/acre plus survey and other transaction costs with annual taxes being next to nil.  Should we jump at it, or let it pass?

A bit of information about us and the property.  We are in our upper 30’s, with two boys 10 & 8.  This is part of the farmstead where I grew up, my parents are retiring and moving off the farm and my older brother and his family are moving to the home and taking over the farm.  I assume they will gradually purchase some of the land my parents own, specifically the home, barns, and adjacent ground to the house.  This includes the wooded property mentioned above.  We live approximately 45 minutes from the site.

We love to camp, mountain bike, trail run, kayak, and generally anything outdoors.  My thoughts (dreams) are to establish a permanent campsite on the property to park our small camper on the weekends and extended time during summer (I’m a teacher).  Along with the campsite, I envision a mile or more of singletrack through the woods, possibly connected to another five or six miles of trails in the adjacent forest on my parent’s and aunt’s properties, about 60 acres forested in total.  I also assume a rope swing and small entry/exit point for kayaks, maybe a treehouse or two for the boys and all of those other dreamy things to do in the woods. 

Long term, I have thought about expanding the camp to allow other outdoor adventure types a place to set up camp, maybe a small cabin or two.  They could ride, run, kayak and play on the property or ride the country roads (both gravel and paved) and pick berries at my brothers blackberry and strawberry field. 

Anyway, this would require us at a minimum to pay the purchase price and taxes, costs to establish some sort of driveway and development costs for permanent campsite and commit us to frequently visiting one location.  We are free to visit anywhere, but would we feel guilty camping elsewhere when we have our own property available?  It would take an immense amount of work to build nice trails and improve the property like I dream of.  Is it worth it?  It would be fun for our boys to see and play with their cousins more frequently, I see a lot of upside in this.

We have no debt, technically we could FIRE today based on a 4% withdrawal rate from investments and we have over 100k in cash at the moment.  I think it’s a great deal and even if we never set foot on the land it’s a good investment and we could pass it on to our boys, sell it to my brother some day, or just hold it and do nothing.

My wife does not want to feel tied down to property so she is not as eager, what do you think?  Is there any risk involved, anyone done something similar and how did that work for you?  Can anyone speak to the mental aspect of owning a second property or have any advice to give?

[Roots&Wings]

For $15k purchase price and next to no ongoing expenses, I wouldn't hesitate or feel tied down if this is something you might enjoy and could ease into, when it's equivalent cost to a few family vacations, and 45 mins away isn't too far.

Since you're FI already, you could potentially consider it investment diversification, as it gives you options. If you find the camping and trail projects aren't all you dreamed of (yes, this does sound like a lot of work), it's not like you've spent very much.

You also don't have to do massive improvements, especially if your wife doesn't share this dream, or feel like you can't go anywhere else for vacation. If you find it's not what you hoped after some trial camping trips, you could always sell later, or leave it to your kids since it has history in your family.

It sounds lovely with the woods and river!

[lhamo]

What is the land like around it and who owns it?  Any chance of lots of development going in?  Any nusiance-type properties nearby, or sites that could become one (I recall somebody here who bought what they thought was a great, secluded rural property and built their dream home, only to have someone open up a gravel pit nearby -- with all of its blasting, truck traffic and dust).  Similar things can happen with garbage dumps, highway expansions, etc.

I would get an estimate on the costs for putting in the access and campsite first -- maybe utilities, too, since that affects resale.

If this is the only way to keep the property in the family I would lean toward it, assuming there are no red flags on the other stuff.  I grew up on a family compound in the country.  My grandparents bought a little lakeside cottage, and then my parents bought the lot next door, built their house, and then bought the 5 acres on the other side when it went up for sale.  My mom later gifted that property to me and my sister and we built another house on it.  For awhile we had three generations living side by side.  It was great.  We no longer have those properties and I miss them.

[former player]

It sounds great apart from the issue of being 45 minutes away.  Please don't underestimate the hassle and time involved in moving a family of 4 that far that often, and also take into  account that your children will soon be teenagers and may then start to prefer to hang around near home with their friends.
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[UponStars]

What is the land like around it and who owns it?  Any chance of lots of development going in?  Any nusiance-type properties nearby, or sites that could become one (I recall somebody here who bought what they thought was a great, secluded rural property and built their dream home, only to have someone open up a gravel pit nearby -- with all of its blasting, truck traffic and dust).  Similar things can happen with garbage dumps, highway expansions, etc.

I would get an estimate on the costs for putting in the access and campsite first -- maybe utilities, too, since that affects resale.

Good point, but the thought of development out there almost made me laugh. There is an extremely minimal chance of development, this property is two miles from a town of 400 people and 10 miles from town of 10,000.  Surrounded by my family's farm ground on all sides, even across the river.  I can use the farm equipment to do most of the clearing, but I do estimate that it would take several thousand dollars of gravel for a drive.  I have a rough idea for septic cost and a well.  If we want a power source for now it would be solar and/or wind.  I don't plan on building a large house ever, maybe a small cabin for us at some point, but I think wood heat and solar/wind would be sufficient for those.

Good points to consider for sure.  I think I could setup solar, water, septic, and a drive for 20-25k.  Initially I think a drive and a small clearing would suffice so 5k should more than cover us to get a little camper back there.  Free for our tent.   

[UponStars]

It sounds great apart from the issue of being 45 minutes away.  Please don't underestimate the hassle and time involved in moving a family of 4 that far that often, and also take into  account that your children will soon be teenagers and may then start to prefer to hang around near home with their friends.
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Thanks player. 

Yes, we have a lot of things we would like to do with our boys before they don't want to do anything with us.  I agree the drive is a hassle, whenever we want to visit family it's always 45 minutes there and back in the same day and that gets old.  That has also been part of the conversation, thinking we could stay the night or a couple of nights and make it a little more worthwhile to visit. 

[lhamo]

Have you done a perc test?  Might be worth investing in.

When my grandparents and parents bought their land they thought it would always be rural, too.  45-60 minute drive to Seattle, nearest tiny town 5 miles by road, larger towns about 10-15 miles by road at the time.  What they did  not forsee was that a huge plot of land owned by Weyerhouser (the big forestry company here) just on the other side of our small lake would be developed into a massive planned community.  The lakeside folk fought to make sure there were no direct roads added -- only emergency access.  But still there ended up being a huge uptick in non-local people coming in to use the lake (it has a public access point).

My dad's colleagues at Boeing used to think he was crazy to have a 1 hour commute in the 70s.  Now that is considered close.  Development trends are hard to predict. 

[Malum Prohibitum]

I would not hesitate.  I do not know about land prices where you are, but that seems extraordinarily low.  It gives you a fun place to go and the ability to visit family but not be too close all the time.  If your finances are good, then pull the trigger.

[Freedom2016]

I empathize with your wife. I would def feel guilty anytime I wanted to go camping somewhere new (isn't that one of the perks of camping - an easy/cheap way to see more of the world??) knowing we had invested $$$ into a family property.

You're talking $15k to purchase the property plus $20-25k additional to make improvements. Is $40k worth it?

I wouldn't do it.

[Roots&Wings]

I can use the farm equipment to do most of the clearing, but I do estimate that it would take several thousand dollars of gravel for a drive.   

Do you need the gravel drive? Guessing you have mud season. Some people have had luck with wood chip drives, or tire track paths, e.g.

[lhamo]

Wondering if there are other ways to approach this that keep the land in your family but do not require you personally to sink a bunch of money into it, at least until you know you will get good use out of it.  Could you "rent" it from your parents or siblings or pay a use fee? 

I guess the underlying question is are you the only option to keep this property in the family?  If not then maybe it is worth exploring alternative approaches.

[Fishindude]

I'd buy it.   If it's got any mature timber, you might be able to have it selectively logged and pay for a pretty good chunk of it.   Also, might be able to get it enrolled in a classified forest program and get taxes reduced to almost zero.

Regarding your thoughts about all of these development activities; campground, buildings, trail network, etc.  While that stuff sounds neat, you've also just wrecked a nice natural woodland and taken away a lot of the natural beauty of it.   Getting a little access road put in and clearing out a small camp site would be great, pretty minimal damage, and very inexpensive.  Most could be done with a chain saw, your back and maybe begging a little tractor work off a neighbor.   You don't need an established trail network to take a nice hike in the woods, nor do you need buildings and structures and a bunch of man made junk permanently in place to have a nice campsite / recreation area.   I wouldn't open it up to anyone other than close friends or family either and maintain some strict rules about leaving things as you found them.

Another thing you need to think about, is that if you or another family member doesn't buy the ground, you have no control and you could wind up seeing the woods getting cleared, new homes being built, etc. on the old home place.   Stuff like this is worth saving and preserving.   They don't make anymore land and it will most likely go up in value over time.

My opinion is a little skewed on such matters.  I bought our family farm 30 years ago, have expanded it three times by buying adjoining neighbors parcels, bought another farm and acreage down the road, plus another large farm in an adjacent state where I like to hang out and recreate.   Land is a solid investment and a good addition to anyone's portfolio.   Unlike stocks, you have something you can physically touch, see, use, potentially get some income from, and you can just about be assured you will get some long term appreciation.
 

[JGS1980]

Sounds like a lovely piece of land with a wonderful connection to the extended family.

You can afford it, so do it!

You can also afford to go other places (despite buying this land) with no guilt whatsoever to appease the boss at home.

Take your time building it up and just enjoy your time with your family out there.