dad just txt me a map of one of the 20 acre lots they sold across the street split up into 16 more subdivision lots

now that 20 acre lot was just part of 300 that was split up. I can't imagine what's planed for the rest.

if I built on the hill where I planned I will be looking at a town like subdivision, taxes will keep going up, yet it could be a good customer base. for our products.but it did stop me from going and buying that new tractor after taking my 12 year old out for his birthday dinner. no since in dropping that much cash on a tractor now

but if I lot mine off and it cost 10 k to get it decided and planed I will still make 900% .

I know nothing about dividing land. it blows becus all my past 16 year plans are potentially in flames. but I may find something nice close to national forest and closer to work. could work out better. but that capital gains tax.

it's early yet and I'm just venting. I mean who wants to have a subdivision move in across the road from you.

A tough decision for sure. I would have a very hard time coping with selling my ranch. If I was totally getting boxed in with new devolvement and sell out and buy another someplace where there is no people.

Be a multi-millionaire ovah night not all bad either but where a person has blood sweet, and tears craved into the ground you owned would be a hard choice to make.

Know where you are coming from. The family farm I was raised on was sold off in less than a year after my brother passed by his kids. And the prices it brought means developers.

I sold the few acres I had that was separate from my house and reinvested it more rural land using a 1031 Exchange to avoid the capital gains tax. Rules for the 1031 Exchange are pretty strict but better than paying the tax to be wasted by the government. Also going to sell my house and relocate. Not going to set here and watch houses grow. No tax implications on the house sale. Just the commissions.

Some folks will buy acreage and sub divide off enough to pay for the whole thing, then sit on what's left. But, you're right the city will chase you down and catch up to you soon enough.

yes that is a hard choice

Do a 1031 and minimize taxes. How many acres would you sell with the house? Might be able to avoid taxes anyway.

I couldn't tolerate a subdivision across the road.

what I would sale would be bare land othere than the 1830s cabin. I didn't think a 1031 exchange worked on raw land?

Talk to someone who actually does it for a living, but it is my understanding that it can work on all kinds of real estate.

If you can make 900% you are upset at a capital gains tax that maxes out at 15%! You can also talk with your CPA about doing a 1031 which will delay the capital gains tax if you invest in like kind property which land and building would be. Why keep something that will sell well and it will look like something you won't like and you can move closer to work and in a more re,mote area. You can always bring your products back to the developed area.

Bryce

I sold vacant land and bought vacant land and used a 1031 Exchange. Real Estate - investment property is eligible. Talk to a CPA to make sure you do it correctly. And I will have a CPA do my taxes this year to insure they are done per the 1031 guidelines.

that was if I divide it and sold it off at lot prices myself. just guessing but figured that would probably cost 10k per acre and with a lot of speculation including guessing sale price if 30k per acre as I have Seen for building lots that would be about 900% .

holding it and as it continues to build up and more and more farms become subdivisions the land prices should only continue to climb. as it is since I bought the farm land prices have gone up 300% around me and that's without doing any work dividing it up. that's in 8 years. so if it continues to build how much more will it bring in another 8 10 or 15 years. It's paid for after all. so other than taxes it cost nothing to hold it.


there are many options but it seems like my long term plans to die on the farm likely won't happen. but that's life and plans change.


dad did send a follow up txt saying the zoning commission noted the watter company could not Handel the demand like the subdivision is currently laid out. to me that says they will end up wanting to Raise the water bills again to pay for it. they went up 60% this year already.

Sorry to make those statements and thoughts when not knowing much of the details. As you state you have several options available to you.

Bryce

Take your monies from the sale and reinvest in more land. Eliminate the capital gains tax . You do know it must be over 250,000 profit before you pay 1 dollar in tax. Invest in a other property except 249999 no tax

You are basing that on present history. When or if there is a correction in land prices your formula is trash. Do it if you think it’s worth uprooting your family. Only you can make that call

I'm a donkey, stubborn. I love my farm and will keep expanding my feedlot to keep houses away.

See what the local setback is for a feedlot and put it as close to the development as possible, they'll probably be forced to move the houses back.

Sold. Collected. Moved out. Never looked back.

there is a county road between. I don't know if that makes a difference.


and j if I did nothing and sold as is profit would be mutipal times that.


at this point I think it's start shopping for land and areas near Hoosier National Forest but close enough it would be a long but practical drive to work. I will get an idea off what things are available and selling for . maybe contact the local realtors and farm co-ops. maybe a correction happens or bad recession hits and people needing to sell will call. with good credit, good paying job and a few paid off pieces of land and a house more than enough financial backing to be able to hopefully pick up what I'm thinking we would want when and if it comes up


tell then holding only cost taxes. and you never know after dad's last txt about the water company not able to meet that demand and or if the economy crashes like I have been expecting it may be a decade before that subdivision fills up. And if the developers are maxing out credit now they may go bankrupt before the economy recovers. never know but if the opportunity opens up and price right maybe I will buy it but build rentals. at least then it's mine.

bottom line is I was tempted to buy the ground when it came up for sale knowing I could have sold a good chunk on the other end and keep what I wanted on this end free and clear or with some profit and I didn't. why I didn't want to bother geting over 2 million in credit approved or put up my never had a loan on it farm as collateral. those # are huge to me and like I said I know nothing about dividing ground or approvals ect . so once again I dropped the ball. yes I could have handled the payments but those would have really scared me. remember I'm more of a want to be debt free guy.

We’ve looked at selling as well, not subdivision, but just selling for a few reasons and taxes are the biggest reason we haven’t.

That's 250k for each you and your wife. 500k tax free. Only the excess is taxed. Put all the maintenance costs and any expense related to the property deducts from tax liability. 1031 tax exchange has very tight timelines for reinvesting. My dad had 45 days. That's not much time.

It sucks having your ranch get consumed by development. I know exactly how you feel.
Some people stick it out.
I went to Boise not that long ago and it is quite odd the landscape there. Fields forever, canals and water everywhere. In those fields are what you would expect. Real old farm houses, 1800's victorian's and also the later craftsman style and just typical old farm houses. But the odd part is the tracts of dense new development housing in the middle of these fields. It is bazaar. 1200 acres of farmland and 300 houses packed together in a square in the middle of these fields. The ugliest houses you ever saw. The builders didn't even stagger their siding, just 12' runs with a trim board slammed against them. There are housing tracts have consumed many of the old ranch houses to where the ranch house only has 15 acres or so and the city has completely consumed the ranch. I could tell this has all happened within the last 10-15 years.

Subdivision? take your money and get away from the city

Can likely get a bigger property. See a tax guy. Wont have to let ukraine have 15% of your money.

Don’t overlook the 1031 exchange tax code that allows you to swap properties without a taxable gain.

What differs capital gains from income tax?
If you keep it you pay real estate tax, if you sell it you pay tax. They're going to get their money.

capital gains is a lower rate at least for now.

You have to move at least 20 miles from a larger city anymore as far as I am concerned to at least begin to feel like you live in the country. The amount of people who are "contaminating" the countryside around larger towns and cities is disgusting. The biggest problem around me is that people buy large tracts of land, build a house right in the middle of it and then re-sell everything but a few acres right around the house. Large tracts of land are now wasteland as far as I am concerned. Its not country, its not city, its just a random house in the middle of what was once nice countryside. Who wants to buy a tract of land with somebody elses house right in the middle of it.

again as bad and irritating as it is its can be a bigger opportunity to bring in more farm income. a farm stor selling products and farm to table meals, u pick pumpkin patches, corn mazes, countless classes and lessons, charging for time on my range, boarding or renting horses. lots of prospective opportunitys. heck if the boys can get all they yards wrapped up that's another thing and more people to sell fire wood to.

it sucks but it can't be stopped. this entire state is to populated so either start thinking about getting out now or how to best profit from the crap show.

if I sell out dad would be left in the middle alone and not happy. It would be best for him mentally and me financially if I hold out.

many time in my life I remember thinking how nice some farms have it with the location to their customers and what that ground would cost to buy would be insane. yes it stinks to have town move in around you but there are financial benefits if you are willing to grab on to them. from business opportunity to just selling out for a big profit.
Thinking about it for a day or so now I see selling out would set me back incredibly in the future so it's best for me to try to figure out how to make the best of what I see as a very negative situation and try to turn it into a positive. it can be sold in the future and likely at an even higher profit. by them maybe I will have found an area in the west we would like to relocate to when I retire. I mean I don't even need a spread as big as I have now as long as it's big enough for the horses ans critters we want. especially if it's tucked up to government land I can saddle up and ride for weeks on. lots of possibilities in life. I just became much less attached to what's left of the family farm.

Here, the "country" is practically gone, this last round of newcomers, because of covid have sent the price of land and houses through the stratosphere, that said there is opportunity for the farms that are left, mostly because they sold the development rights to the county. but the bigger ones still have their farmstands, but have supplemented with corn mazes, spooky houses for halloween, petting zoos, wine tasting,playgrounds, etc... summer weekends and especially in the fall they are slammed with customers, prices are just short of city prices so the people think they're getting a bargain. They get so busy they need the cops to direct traffic. They have armored trucks to haul away the loot!

So, if you start even small, have some people skills , and develop a clientele you can build a farm business that will support several families, and you still have the farm and it's traditional businesses....

make lemonade out of lemons.....

I would rather be broke over living close to neighbors. My peace and quiet is more valuable than my dollars. Yes, there are advantages to the city encroaching if you have that mindset and desire to make money off it there are all kinds of ways. I don't have that mindset. I dont even understand why people mow more than a hundred feet around a house and buildings.....waste of hay ground to me.

In the West some of those areas where there is ranch/farmland and you wonder why are there not houses there are permanent easements to keep everything from being developed. Son just moved to Steamboat Springs, CO. Saw where two different ranches were paid roughly $1 million each to guarantee they will never sell to developers. County paid. Keep your land and make money like always and get $1 million for just agreeing to never sell. Pretty good deal.

My biggest problem with living in town is barking dogs. Everybody's gotta have them.

I’m the opposite, I live in a nice little neighborhood and if I was to win the lottery, I wouldn’t move. I have access to enough private properties with 10-25 minutes from my house to just get away so no need for me to live away from everyone. I have a soon to be 10yr old with 5 boys and 2 girl friends that play every single day outside, rain or shine. In fact they’re out there right now still playing and it’s getting dark.
I have great neighbors and recently had a young couple move in and their next door neighbor took them around the neighborhood introducing them. Everyone watches out for everyone else. In fact the older gentleman two doors down lets the boys use his ditch as a bike ramp and gives them access to his driveway to turn around in. The little church down the road has a playground and basket ball courts they play on. And on top of that, the ladies at the little store at the end of the road will call to let us know the boys are on their way home when we let them ride to the store to get a coke in the glass bottle. They think that’s the coolest thing, lol.
So in my situation a neighborhood works just fine for me.