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Farmland Auctions In Texas: A Guide To Know Before You Go

Friday, December 14th, 2018
farmland auctions in Texas, tips for bidding and buying

If you are considering the purchase of farmland in Texas, your first step is to find land that will fit your needs and is up for sale. Property auctions are great for getting the perfect piece of real estate at an affordable price. Check with local auctioneers to see the types of property coming up for auction and find the tract that will meet your needs. The following are some tips you should know before heading to a Texas farmland auction.

How to get financing

The purchase of raw land versus residential land in Texas is different. Most banks will not approve a loan for raw land purchases. You will want to check with farm credit institutions which typically handle purchases of rural land before the auction. This includes figuring out your budget.

Tax exemptions for buying farmland

You may qualify for wildlife, agriculture, or timber exemptions under Texas tax laws. These exemptions can save you thousands of dollars on your property taxes each year.

Know the market

Before heading off to auction, you want to research the market and ensure the price for the land meets market values. The county appraisal office should have a valuation of the farmland you are considering. You can also check the local listings that may have similar properties for sale.

Check the land for possible improvements

If the farmland you are considering does not have an existing well, you should check with local contractors to learn the costs of digging one. Check with neighbors or local service agents to find out average depth for wells and what the soil condition requirements are for installing sewer systems. These costs may affect what you are planning on investing at the auction.

You may also need to know what the existing buildings are on the property and their condition. If you are planning on adding a new building or need to replace existing ones, you will want to know the building codes for the area. You should also see if it will be possible for you to add or replace buildings.

Check environmental factors

There are a couple of factors that could impact your plans for the land you’re considering to purchase at auction. One is if there are any endangered species inhabiting the area. When certain species are identified in a specific area, this can affect what you are allowed to do on the tract of land. Make sure there are no restrictions in place that hinder your plans.

Another factor to consider is if there has been any environmental contamination from previous owners. Once you have purchased the farmland, it becomes your responsibility to clean any contaminants. If there are any issues with cleanup requirements, you want to get some protection from liability.

Check how access to the property is set up. Farmland in Texas can be remote. If the piece you are looking to buy is too far away from other property, you may have to build a road. There could also be a road to the property that has not been maintained which you will have to replace. These improvements will add to the cost of your purchase.

If you are planning on planting on the farmland, you will want to know how much land is tillable and if you can make the property profitable. This will also affect your auction budget.

Know your budget before the auction

Knowing the property costs before the farmland auction is essential. You will need to have a budget set as to how high you can go on the purchase of the land. Once the land is purchased, you will have ongoing maintenance costs. There may be improvements needed, annual property taxes, and more to consider in your budget. Have a set price you can bid and know when to stop.

Going to the farmland auction

When heading off to a farmland auction, you will need a good eye and an understanding of the process. Bring along a deposit for the property in case your bid wins. Arrangements will be made with the owner after the sale concerning the final price and closing costs.

Farmland auctions in Texas

For more information about buying farmland at auction, contact the experts at High Plains Auctioneers today. You can call us at (806) 244-6776 or Send Us an email to learn more about Selling or Bidding at auction. Don’t forget to check out our Upcoming Auctions to see what we have available!