One long-term investment that we made and have enjoyed over the past twelve years is rural central Texas land. Historically, land has increased in value over time making it a viable long-term investment. To quote the beloved humorist Will Rogers: “Buy land. They ain’t making any more of it”. Land, like any other investment fluctuates in value, but it has typically been a solid investment over the long haul. The ever-growing population of the world continues to rise. It makes sense that more food will have to be produced in order to feed the increasing population. Land prices should be on the rise again soon, and it appears to be an opportune time to invest in rural acreage before prices begin to soar here in central Texas. Ultimately, as world population increases, so will the demand for farm and ranch land. This was actually one of our deciding factors when we chose to invest in central Texas ranch land. According to an article in the September 2011 issue of Realtor® Magazine, things are looking up with regard to U.S. farmland & cropland values. The future is bright for those who have acreage to sell and for those ready to buy.
You don’t have to be an authentic farmer or rancher per se to own and make good use of your acreage. If, like us you’re not, you can quickly learn enough to run your own cow/calf operation or you can always lease out your property for cattle grazing or cultivation. You can immediately reap the benefits of an agricultural property tax exemption, better known as an “ag” exemption (significantly lowering property taxes – provided the exemption is already in place when you acquire the property) without having to be on site continually to run your cattle or farming operation. If a property doesn’t have an ag exemption, one can be applied for. The “ag” exemption along with the various income tax benefits of owning a ranch have provided us with substantial tax relief over the years. On the other hand, just having a place in the country to escape to when city life makes you crazy is reason enough to invest in central Texas ranch land or recreational acreage. When we first decided to buy acreage in central Texas’ “Top of the Hill Country” in Hamilton County as our refuge from the city (DFW), our main plan was to find a recreational spot where we could hunt, fish, 4-wheel and search for Indian artifacts and fossils. We knew that in order to maintain our ag exempt status, we would have to do a little more than just play. So, we bought a few cows to graze the range land and leased our cultivated fields to a local farmer for grain production.
We’ve made considerable effort to sensibly diversify our investments. Like many of you, for the majority of our working lives our investment portfolio has consisted of mostly 401K and taxable market securities. But, over the past 20 years, we’ve added to our portfolio: several rental properties, a combination cattle/recreational ranch in central Texas (where we now live), a commercial construction company in Waco, TX and finally, a farm & ranch real estate company located in Cranfills Gap, TX. As seasoned professionals, we understand the importance of financial diversification. In hind sight though, our best investment overall has been the central Texas ranch. Our initial decision to invest in rural central Texas property was made with the ultimate goal of “paying-off” in the future, but enjoying it now. We came to the realization that life is just too short & unpredictable and we made our choice. Of course, stock market investments are essential to insure our retirement future, but they are long-term investments that can’t be enjoyed on a consistent basis. There’s no guarantee that we’ll still be around to see the end result of all of our investments, but we are confident in our decisions – twelve years later we have absolutely no regrets. Not only are we having a great time living in the country now, but we also have peace of mind knowing that we’ve secured our future with smart investments.
For help locating the rural property of your dreams – visit http://www.txbrandland.com