Anyone familiar with Missouri farms?

Question

I'm hoping to connect with landowners, investors, agents and lenders familiar with farm land in Missouri.

My husband and I are interested in a lifestyle investment in some land where we can get away from the city with the kids. (And where my husband can hunt!) We'd like this farm to at least partially, if not fully, pay for itself with rented tillable acres, timber, etc. Looking for something 60+ acres that's within a 3 hour drive of St. Louis. Anyone have experience with this??

Justin Tahilramani · Answer

Megan - technically all six units are furnished short term rentals - length of stays vary. We absolutely still enjoy the land and use it for hay production. If you go this route I would recommend buying land near a large hospital, military base, national park, etc. Something that will consistently bring people to the area.

David Ounanian · Answer

Hi @Megan Greathouse I've analyzed a handful of Missouri farm properties over the years with my brother in law who grew up on a farm in NE Missouri and currently rents his farm land.  Lucas is right they will not cashflow at all especially if you are putting debt on the property.  60 acres might rent for $10k/year.

David Pere · Answer

@Megan Greathouse I hear Springfield is nice...and I (may) own 10-acres across from my father-in-laws 400+ acre cattle farm. Lots of farms around, and my real estate agent lists a lot of them for sale. let me know if you want to chat!

Lucas Gillmore · Answer

Megan, I am an agronomist by trade and worked in NE Missouri for 5 years, I now work in SE Iowa. There was a realtor in Canton, Mo who I thought was really good and seemed to be very connected to the NE farming community. I can’t remember her first name, her name is Wood. She also sells crop insurance. I will warn you though farm land to rent out will not have a positive cash flow or pay for itself for many years if ever, and don’t let a realtor tell you otherwise. Think about it why would a farmer pay rent to someone when he/she could buy it and keep the cash flows?

Also nobody drops glyphosate out of airplanes.

Max Householder · Answer

I like that approach Justin. My wife and I have been thinking about a farm/rec property. We were thinking paying cash would be the way to go and then try to find one or two income streams we could get from the property that overtime offset the holding costs which when paying cash would be basically the taxes and not much else. Between hay, timber, maybe plant an orchard, berry patch, pumpkin patch, Christmas trees, grow other ornamental or fruit trees for sale, maybe cabins or a couple RV sites or even some rustic campsites, a fishing lake, there are so many avenues to make $150 here or $500 there i think you could make it pay for itself over time

Megan Greathouse · Answer

@David Ounanian thanks. Those numbers are in line with what we've seen so far... tillable acres renting for about $150/acre annually. I've seen other income options (timber and CRP)... but none of it seems enough to cover the full cost of owning the land.

We're still gonna buy something. It's for fun! But it's good to understand the income options, and how far they'll take you, ahead of time.

Justin Tahilramani · Answer

Our farm is in North Carolina -  our farm pays for itself with rental income from long an short term rentals that are on farm. Renting out acres would not even pay for the taxes on the land....

Alex Olson · Answer

Totally understand. I think you can get close.

Megan Greathouse · Answer

@Karl B. and @Alex Olson Thanks, guys!

Karl - is the broker you know familiar with farm land?

Alex - I hear you! We're not looking to make a bunch of money off this... we just want to get as close to covering the costs of our second home as possible. A family getaway that simply pays for itself is the dream. :)

Alex Olson · Answer

@Megan Greathouse I grew up on a farm in NE but am familiar with the cost and the upkeep. I think it could be done with enough money down but you have to haven enough money down for it to be cash flow positive. Cost per acre of tillable land could be anywhere between $2,500 and $10,000 depending on how good it is and how flat it is. You will want to do a lot of due dilligence. Maybe meet up with a local farmer around you to see how to make it cash flow. If it was a great deal, a lot of farmers would be a lot richer. However, I do think you could make it cash flow positive or neutral with the right investment.

Anyone familiar with Missouri farms?

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