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Young Farmer Land purchase questions
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IA1stGenFarmer
Posted 4/22/2021 21:41 (#8967939)
Subject: Young Farmer Land purchase questions


I am looking at a piece of ground that my wife and I would like to purchase, Seems like land prices are creeping back up fast due to some short term factors IMO. Wondering if it is a good time to buy for a young guy who is going to end up borrowing 95% with 5% cash down via FSA Beg. Farmer program to make it happen. Assuming 2.8% interest rate and would be looking at $12,000 Acre for good dirt (90CSR) on 100A. Land is close to my house which would be nice as I am a hog farmer and would need to haul manure on it.

My struggle is merely with good or bad timing of the purchase. I am currently finishing 3500 hogs a year and can make money doing so. I realize debt can be a valuable tool but it just seems like crazy large amounts of money to borrow as a 34 year old just to have the rights to farm the ground.

I'm torn between waiting to purchase land and try to pay off the hog operation and put away cash in order to put more down on piece I really want later in life or leverage myself now and get after it and hope and pray things hold together? Anyone have experience getting out of debt and having things progress or advance at a even faster/better rate?

Do you think there will ever be a large correction in land prices where there would be more opportunities for guys with cash to capitalize on or is ground going to just keep climbing and be $20,000/A (The new norm) in 10-15 years?

Any input on your experiences and or advice for making such an educated large decision would be appreciated! TIA
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