Whether you are a new sales rep looking for those first clients or a seasoned seller who wants to make a change, specializing in rural real estate is one way to establish yourself in the industry if you have an affinity for farm life or enjoy matching parcels of land with prospective farmers. For those who have long dreamed of having their own acreage but find themselves short on time to maintain it, selling rural property can be an introduction into what rural life is all about. To specialize in an area of real estate is taking that leap of faith – believing that you can do it and will not be missing out if your focus is on rural homes rather than those in town.
Depending on where you are, doing deals with acreages and farmland can be more lucrative than selling urban houses. Consider small-town British Columbia, for instance. An hour or more outside of the major centres and suburbs, an older house or new apartment/condo sells for around $250,000. Rural land in the same area sells for $700,000 for a 1901 house and 18 acres of land. In some areas that price goes up to $6.9 million for a 1971 house and 177 acres of lakefront land. To get such high property values inside the city of Penticton you need a luxury house and larger-than-usual lot, and the average high-end price for residential housing is around $1 million (three listings).
But consider what you will need to know in order to sell rural land. Farmland is used for many different purposes. You can have grazing livestock in pastures, animals around the barn, crops in the field and vineyards in the hills. Knowing which sort of farmland is in demand and most desirable in the area will help you set the right price for a sale.
Ask around and do your research about local crops grown, what sort of livestock does well in your climate and whether farm operations are mainly acreages and hobby farms or commercial crops, ranches or recreational. In Alberta, for example, there are many crops that can be grown and farm use varies greatly depending on the area. As you suspected, it can depend on the soil quality. This doesn’t mean some rural properties have no value. It simply means that knowing where the value lies can help you to sell to the right buyers.
As with urban real estate, you must know what uses are allowed on the land, as well as have a working knowledge of wells, septic systems and local environmental concerns.
Legalities include capital gains exemptions. There is lots of information regarding what land and what sellers may be exempt from capital gains. This can result in significant money savings, so be sure to have a copy of the relevant laws available for customers to browse.
You may also want to have information about succession planning, where your seller may want to sell their farmland to family in a way that avoids other non-family sales taxes. Provincial regulations vary. For example, in Manitoba the government provides a guidebook for land buyers that includes information about forms of ownership, rights, responsibilities, titles, transfers and more. If your customer wishes to buy farmland and take advantage of federal programs, they will need to ensure they have the right forms submitted to make the process run smoothly. Alberta has a similar guide. Consider having this information as a value-added service to your rural clients.
Marketing and displaying your listing may be a challenge as well. Bare land does not lend itself to interesting photographs. If, on the other hand, the property you are selling has a lovely landscape, consider hiring a drone operator or renting a drone if you are comfortable flying one and take a few fly-over photos from above to showcase the best features. The house or other buildings on the land should also be photographed equally diligently to provide the best listing. Acreage and hobby farming land could be accompanied by a map showing where buildings are to give a sense of scale, as could an empty piece of land. Parcel it by acre on a map and perhaps add a “to scale” building to give an idea of what will work for the property.
While you are conducting deals for a different sort of market than urban properties, selling rural land can be rewarding for many reasons. First is the satisfaction you get from helping people to realize their dream, or as they grow older, leave the farm for something more manageable. Land sales can be a bit more straightforward than other properties. If you enjoy the outdoors, you will be able to get out into the countryside.
Yvonne Dick is a contributing writer for REM with two decades of experience in journalism.
