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to buy or not to buy is the question

Started by bigred1951, September 21, 2013, 11:27:14 PM

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bigred1951

well i have a chance to buy my mamaws home place off my uncle for $75,000. Its just under 80 acres and far as i know its been in the family since the 30s-40s. There is electric and the old home there which needs work but there is no water or anything else run that far back up the holler. Its heaven to me up at the end of a holler nobody close by just peace and quite. But im worried i wouldnt be able to afford to payment thats if i could even get approved to buy it. How much do you all think i could get out of the timber since theres 80 acres. To my knowledge it hasnt been logged since its been in the family. They actually use to have a couple small coal mines there way back but have since fell in and i wouldnt know where to start looking for them. I talked to one logger and he said he had would give me 35% and that he logged 50 acres a while back of not very good timber and got 50,000 total out of it. Hoping to hear everybodys advice and maybe somebody knows a logger who would be interested. I was really hoping someone could offer a lump some for the timber instead of doing on percentage. By the way the land is in olive hill, ky

Ljohnsaw

Sorry, I can't help with the logger questions.  But, is your uncle will and able to carry a note for you?  $75k may sound like a lot of money but with a 15 year note, your monthly payment would be about $350.  Do you have any money saved up that you could give him a down payment?  There is more than one way to skin this cat.
John Sawicky

Just North-East of Sacramento...

SkyTrak 9038, Ford 545D FEL, Davis Little Monster backhoe, Case 16+4 Trencher, Home Built 42" capacity/36" cut Bandmill up to 54' long - using it all to build a timber frame cabin.

bigred1951

note? do you mean loan? i would have to go through a bank or something to get a loan and no i havent saved up. Im hoping to get it set for 30 years or the longest time possible so i can have the lowest monthly payments. Being 22 years old and new career its a big step and scares me alot haha. But i know if it worked out the way i have pictured i think i could pull it off and that it would be a good investment plus it would make me and my mamaw happy that i have the old home place.

julio

that a little north for good coal so it going to be mostly timber that you would make money on
If you put your finger in your ear and scratch, it sounds like PacMan.

Ljohnsaw

Quote from: bigred1951 on September 21, 2013, 11:57:14 PM
note? do you mean loan?
<<snip>>

Yeah, a loan - sorry, I'm old.  As in, "hold your note of promise to pay".  aka - a "promissory note".  You could probably qualify for a 30 year if you have any kind of decent job but would do good to make extra principle payments when you can.  Amazing how fast you can pay it off that way.  Best of luck to you.  I admire you for trying to buy at your age.  Not many thinking ahead these days.
John Sawicky

Just North-East of Sacramento...

SkyTrak 9038, Ford 545D FEL, Davis Little Monster backhoe, Case 16+4 Trencher, Home Built 42" capacity/36" cut Bandmill up to 54' long - using it all to build a timber frame cabin.

WH_Conley

Olive Hill is only 15 miles from me. The land values should be pretty close. Let's take it 1 thing at a time.

1, Price. Out of state people are buying land to hunt on and because it is cheaper than where they live. Timber land that has been cut over is going from $500.00-$750.00 per acre. No house or electric. With electric already there you have a building site if the old house is not repairable.Is it accessible year round, that is another plus if it is.

2, Timber. Without looking none of us can give an idea. I know of one tract that has not been logged in about that long. Haven't walked the whole thing, but, me and an experienced logger that did some logging for me both guessed about 3000 feet per acre Doyle rule. The last logging I had done was in 2008, the place had been logged 14 years before. The timber averaged $330.00 per thousand Doyle. It had been high graded previously. It averaged 1500 feet per acre. The price of timber has come up a lot since then. Your place should do better. I know a couple of reputable loggers in the area. I also know some I wouldn't let near my property. If it is decent timber you can get half with no problem.

I'll PM you my phone number. You can give me a call, we will talk it over and maybe get a little better idea what is going on. I will suggest you use a Forester, but, you are not at that point yet. As for what you posted it sounds like a good deal.
Bill

luvmexfood

BUY IT. If you can't handle the payments then you could always resell it. But if you don't you may reqret it the rest of your life.

I have an aunt and uncle who sold their family business. Along came an offer they couldn't refuse. Now they are multi-millionares. They have bought three or four farms that I know of for an investment. Uncle works most days on them clearing land etc. Best I know he just leases the pasture and hay out.

Maybe you could get the timber appraised and use that as collateral for the loan. If you do keep the figure to yourself if it is decent. Don't want anyone to come out of the woodwork and offer a lot more and knock you out of the running.
Give me a new saw chain and I can find you a rock in a heartbeat.

Ken

I had much the same opportunity many years ago and let it slide.  I too was in my mid 20's.  Although I could not afford it at the time hindsight tells me I should have found a way to buy it.  You will probably regret it if you don't act now. 
Lots of toys for working in the bush

Mooseherder

I hope you can find a way to buy it.  Good luck. :)

stavebuyer

If the timber is decent; its worth more than 35%. Take up WH on his offer to do a walk through. One option is that you may be able to work a deal with a sawmill to pay cash for the timber at closing. Without family assistance it may be difficult to get a low down payment loan on unimproved ground. Try and find a way to get the ground bought. You won't regret it,

David-L

I would try every avenue to do this deal. Talk to the bank after you have a written timber appraisal in hand and use this or most of the proceeds to immediatly offset the bank note. The bank may want that in writing but that is how they work. Maybe use the same bank your grandparents have used so there is family history there and a relationship already started. Having an asset like this is always worth the initial effort to make it happen. It can be a pain in the butt but in the end well worth it.

                                                                Good luck   David L
In two days from now, tomorrow will be yesterday.

WDH

I also suggest that you buy it.  Hire a Forester to do a cruise appraisal and you will know exactly what the timber is worth and y'all can discuss a plan so that you do not have the clear-cut the entire property.  It is great that Mr. Conley is willing to help you. 
Woodmizer LT40HDD35, John Deere 2155, Kubota M5-111, Kubota L2501, Nyle L53 Dehumidification Kiln, and a passion for all things with leafs, twigs, and bark.  hamsleyhardwood.com

thecfarm

Take WH_Conley up on his offer. I have never seen the land,but never been cut and he will only pay you 35%.  ::) and another one.  ::)  Mine land here had never been cut and I got 60%. It was very good cutting. And he came back for a second cutting and a third one and he will be back again in a few years. And if you do have it cut,get a GOOD tax guy to help out with the taxes that will have to be paid on the log money. Good luck to you. I have the old home place and I am living the dream. Walk any of the loggers past jobs to see how your land will look when they are done.
Model 6020-20hp Manual Thomas bandsaw,TC40A 4wd 40 hp New Holland tractor, 450 Norse Winch, Heatmor 400 OWB,YCC 1978-79

Autocar

Its pretty hard for me to believe that its never been logged, if it hasn't around here I have seen saw mills buy the property clear cut the woods then resell it to a area farmer. Maybe you can find a banker that likes to hunt and tell him he has the soul rights to hunting on the property  8)  :D  :D Iam like some of the other guys if you don't try to buy it your always regret it. When I got out of the service in 1969 there was a farm north of me they wanted $18,000.00 for 56 acres it might as well been eighteen million I couldn't come up with the down payment. I still kick myself for not trying harder. Only draw back on selling the timber off there won't be anything left. Not sure if this is correct but years ago I thought someone in your family could barrow the money from the V.A. if they were in the service in your name but not sure about this. Thats how I was able to get my first place but even at that it wasn't easy to get and there wasn't any breaks I borrowed $8700.00 and if I would of paid it over thirty years I would of ended up paying the V.A. $87,000.00. I hope everything works out in your favor nothing like walking down a trail in your woods this time of year.
Bill

samandothers

As others have stated if you can swing it some how do it!  By the sounds of how you describe the place it has meaning to you and I think you will regret not acting.  I hope it works out!

bigred1951

thanks guys ill def take you up on that conley and give you a call about it. I couldnt tell you what all the timber is or how good i havent ever really walked it before i just know its alot haha.

WH_Conley

If you want to come over some time I can show you some of my own home grown Forestry management. The old man I bought off of owned it since '55. I bought in '97. I cut the large trees tat were going bad. I have more timber now than when I bought it.
Bill

bigred1951

im gonna take you up on that soon probly and give you a call and see what we can get into. But only free time i have with work is wensdays and thursdays

mad murdock

Sure hope it pans out for you! 80 acres of old timber for 75,000 sure sounds like a sweet deal! Check into the deed as well, if you have mineral rights with the deed, and ther is known coal there, you may be looking at future gas/petroleum leases as well, could be a saawwweeeet deal, especially for a youngun' such as yourself!
Turbosawmill M6 (now M8) Warrior Ultra liteweight, Granberg Alaskan III, lots of saws-gas powered and human powered :D

CX3

Don't be silly get to the bank and get the money and buy it
John 3:16
You Better Believe It!

Jason_AliceMae Farms

Like everyone else here has said I would definitely try to make it happen.  I took the plunge on my property a few years ago after being very timid initially about it just like you.  I could not be happier that I made it happen. 

If you love the property you will love owning it and taking care of it.  Make sure that you have all of the rights to the property (oil, mineral, gas, timber)  I would hate owning the "top" of my land but find out later that someone else or some company owns everything under the ground.

Good Luck and look at it like you are planning for your retirement!
Watching over 90 acres of the earth with 50 acres being forest.

Someday I would like to be able to say that I left thes 90 acres healthier than when I started watching over them.

goose63

A least try it cost me 10 grand for 8 acres power and water is all I got here in N D darn glade I did it  8) 8)
goose
if you find your self in a deep hole stop digging
saw logs all day what do you get lots of lumber and a day older
thank you to all the vets

semologger

when i was your age i had the chance to buy mt great grandmas place. my grandma and grandpa own the adjoining 2 acres. i could of bought it for 15 to 20 thousand around that. it had house on it. about 1 mile from town. same ground 14 yrs later is worth around 75 thousand acre. kick my self for not buying it.

bigred1951

im still thinking about buying but working on getting some loans paid off first before i really dig into it. I talked to my uncle and he said for 85,000 he will include the mineral rights. I know there is coal there and might get lucky and have oil or gas to never know. He said its there for when i want it that its not going anywhere. Hopefully i can buy it get it paid off and start building my own off the grid homestead.

Clark

Your uncle holding the place is pretty nice of him. I would offer to start some payments before you "buy" it just to make sure he holds it.  This will get you financially used to making a payment towards the land and also chip away at the cost.  Get everything in writing.

Did you take WH up on his offer?  Either take him up on his offer or call a consulting forester.  One reason consultants are still around is that they tend to get better bid prices for landowners.  Surveys show that landowners are happier and wealthier after hiring a consulting forester.

Clark
SAF Certified Forester

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