While much of the land access arrangements we see in the region is through leasing, purchasing land is ideal for long-term security. Can that be done on a tight budget? Our own Jim Kurczodyna (pictured above with his family and their cows) has experience doing just that. Below, he shares his family’s land purchase story.
This past summer we purchased a small farm in McHenry County where we plan to homestead and grow a business. We started by agreeing on basic criteria: an affordable property, basic home, at least five acres zoned Ag that could accommodate our cows, and a location within an hour’s drive of both of our families. These parameters helped us focus in on McHenry County, where we found affordability and strong support for agricultural initiatives.
The bad news was that competition for properties within our sub-$300K price range was tremendous! We pulled up our 2004 minivan to one property, for example, and found ourselves next to the Tesla of a slick looking real estate investor from Chicago.
In all, we put offers on three different properties. One was a 20-acre place at the very top of our price range. A second was a “too good to be true” property that we had to back away from following a horrifying home inspection.
The property we purchased was a HUD foreclosure that was well within our price range. It had immense potential, but the home would clearly require a LOT of work. This played into a useful strength of ours – a commitment to spending little money! We were determined to do the renovation work ourselves and learn necessary skills along the way. So far we’ve put hundreds of hours of work into the home and setting up the farm.
While our search wasn’t perfect and we had our fair share of bumps and bruises along the way, we love the property, home, and the value we came away with.
Here are some strategies and lessons from our search which we hope might be useful to you:
Make sure your family is on the same page: Purchasing farmland is a big and expensive decision. We all have unique preferences and values and can tend to narrow our focus around those. While Joelle paid attention to things like space for our kids to run and play outside, I was focusing on where we’d establish the orchard and pasture the pigs and poultry. Keep making desires known. Ask the hard questions. Challenge each other in a kind and considerate way. This will make for a decision you’re behind 100% and protect your relationships.
Information is valuable: The nine-hour round trip from west central Wisconsin to McHenry County with a young family made property viewing a major challenge. But the more properties and locations we saw, the more clearly we understood what we were seeking and what the market was for an area we originally didn't know well. We also chose to work with a realtor who enabled us to act quickly when necessary, which, given our timeline and cross-state search, was a good decision.
Understand your financial picture and save with your future goal in mind: We literally track every dollar and do not spend above a designated amount each month. Having a firm grasp of your monthly spending will allow you to adjust your budget numbers uniquely for each property and forecast if you can make it work or not. Also, a few years before leaving my previous career, we challenged ourselves to live off the reduced income we’d expect to have while growing a business. The cash reserve we built up (our “dream fund”) made us feel less intimidated by the career leap into farming. It also gives us more room to breathe while we build up our products and a customer base.
Being resourceful creates value opportunities: We were able to save thousands of dollars doing most of the renovation work ourselves and by buying secondhand home and farm items, like kitchen cabinets, portable fencing, and appliances. This strategy has required time and patience. But we have gained invaluable skills and designed a space that uniquely meets the needs of our family.
Utilize the people and resources at your disposal: One 30-minute phone conversation with the you-pick blueberry farmer across the street taught me more than any Internet search could have surfaced on the first property we put an offer on. This ultimately helped guide our offer price, and we felt reassured not increasing our offer drastically when it became a multiple offer situation. Online maps and searches are helpful, but also walk properties, meet neighbors, and call helpful organizations (like soil and water conservation districts) to complete your assessment of a property.
Be prepared to make a move or to walk away: I believe in a slow and organic search process, but I also believe in moving swiftly when you know what you are after and the right opportunity comes up. Line up your financing and preapprovals early. Know your criteria and where you won’t compromise. This will position you to move when the time comes or pull out. It was gut-wrenching to lose money by walking away from an opportunity after a home inspection. But when the information in front of you and that feeling in your gut leave you unsettled, pulling out may be your most cost-effective option long-term.
If I could leave you with one final thought, it’s this - there is no perfect farmland opportunity out there. Each property offers idiosyncrasies that become the new “normal.”
In our case, who could have guessed the nice county building across the street also had a firing range in the back for county police officers? And so, we live with the occasional “pop, pop, pop” while our kids ride their bike and dig in the dirt!
Knowing we found the location and property we were after, however, allows us to feel really good about the land we're sinking our roots into.
Jim and his family's story can be followed at www.fromscratchfarmstead.com.