Buying Farmland in Wisconsin
A Practical Guide for Prospective Buyers
Purchasing farmland in Wisconsin offers a blend of opportunity and heritage for prospective buyers. Wisconsin, with its rich agricultural history, is home to a diverse range of farm properties, from sprawling dairy farms in the Southwest Region to crop-producing lands in the Central and Northwest Regions. This state is often celebrated for its cheese production, a testament to its strong dairy farm presence, but it also supports varied agricultural activities, including crop farming and livestock.
Finding the right farmland in Wisconsin requires careful consideration of the region's geography and climate as they significantly influence the type of farming that can be sustained. For instance, the rich soil in the Southwest region supports a variety of crops, while the Central region, with a more diverse topography, offers options for both arable farming and livestock.
The investment in Wisconsin farmland is not merely a financial decision but also one that includes understanding the locality's farm culture and resources. Buyers should consider the existing infrastructure for farm management, such as access to markets, water availability, and local farming support services. With a well-informed approach, buyers can navigate the plentiful options Wisconsin provides for farm ownership and operation.
Understanding the Wisconsin Farmland Market
The Wisconsin farmland market has shown a clear upward trend in value over recent years, and understanding the nuances of its pricing can be pivotal for potential investors.
Current Market Trends
The market for farmland in Wisconsin has seen consistent growth. The average price of agricultural land in the state has escalated, marking an 11 percent increase from 2021 to an average of $5,551 per acre in 2023. This rise in value demonstrates a higher than 20 percent increase compared to the pricing in 2020. Furthermore, the number of farms for sale decreased by nearly 28% in 2022 when compared to the previous year, indicating a possible reduction in land and farm availability which can affect the market dynamics.
Price Per Acre Insights
When observing the price per acre, there is a noticeable variation depending on the type of land. For instance,
Cropland: $6,710 per acre
Pasture: $3,150 per acre
These figures suggest that the listing price of farmland for sale in Wisconsin can vary widely, with cropland generally commanding a higher price per acre than pasture. Additionally, the sale price is influenced not just by the land type but also by factors such as location, soil quality, and farm output potential. Potential buyers searching for acreage for sale in Wisconsin should consider these variables to understand the land for sale in Wisconsin and make informed purchasing decisions.
Types of Farmland Available
Wisconsin offers a diverse range of farmland options, catering to various agricultural endeavors. Whether it's for intensive tillage, expansive cattle ranching, cost-effective grazing, or cultivating crops, buyers can find suitable acreage tailored to their specific farming needs.
Tillable Farming Ground
Tillable farming ground refers to land that has been prepared for planting crops and is characterized by its fertile soil. In Wisconsin, this type of land often ranges in size but can include properties as extensive as 80 acres in Eau Claire County or larger. These grounds are regularly utilized for growing a variety of crops, such as corn, soybeans, and wheat.
Large Cattle Pastures
Large cattle pastures in the state provide ample space for animal husbandry, with acreage sufficient for both grazing and operational structures. For instance, farmland in Winnebago County can feature pastures that span 168 acres, exceptional for those looking to raise cattle or other livestock. Such properties are equipped to support large-scale ranching operations.
Cheap Grazing Land
Affordable grazing land offers cost-effective options for buyers aiming to support livestock without a hefty investment. These tracts of land, while smaller in acreage, present viable options for starting or expanding herd grazing. Wisconsin's Grazing Land typically includes a mix of grasslands suitable for animals like cattle and sheep.
Arable Agricultural Land
Arable agricultural land is specifically suited for crop production, highlighting land that can be plowed and used to grow staple crops. Farms with arable land in Wisconsin vary in size, some offering measured areas for boutique farming operations, while others boast vast expanses of acreage for large-scale crop production. Properties such as those found in Chippewa County can include arable land upwards of 128 acres.
Dairy Farming in Wisconsin
Dairy farming is a cornerstone of Wisconsin's agricultural sector. Those interested in purchasing farmland for dairy operations must evaluate both the operational aspects of dairy farming and the infrastructure requirements needed to maintain a productive and profitable farm.
Understanding Dairy Operations
A successful dairy operation in Wisconsin begins with a thorough understanding of the land's composition and quality. Potential buyers should consider the land's capacity for grazing, feed production, and manure management. The state's average price for agricultural land was $4,757 per acre in 2021, reflecting a 10.7% increase from the previous year. This figure emphasizes the importance of strategic investment in dairy properties that meet both the financial constraints and the operational needs of the buyer.
In terms of real estate, potential buyers often find diverse listings that vary in scale and suitability for dairy farming. For example, while some properties may offer large pastures ideal for grazing, others might include existing infrastructure tailored for dairy operations, like milking parlors or storage facilities for feed and equipment.
Infrastructure Requirements
Infrastructure is a critical element for any dairy farm and can prove to be a significant investment. Buyers must evaluate properties based on the following infrastructure criteria:
Land and Buildings: The availability of barns, milking parlors, and appropriate waste storage facilities. Access to Water: Dairy farms require ample water supply for both livestock and crop irrigation. Energy Supply: Reliable energy sources to power equipment and facilities. Livestock Facilities: Adequate space and conditions for housing dairy cows, including ventilation and temperature control to ensure animal comfort and health.
Prospective dairy farmers should seek out Wisconsin properties that either already possess these infrastructural elements or possess the potential for development. With the region's land value appreciating over time, the right investment in infrastructure can substantially enhance a property's value and the return on investment for the farmer.
Legal Considerations and Zoning
When buying farmland in Wisconsin, prospective buyers must navigate a complex set of legal considerations and zoning regulations. These standards ensure that the land's use remains consistent with state and local agricultural policies.
Land Use Regulations
Wisconsin’s Farmland Preservation Program plays a crucial role in defining land use regulations. Counties may establish Farmland Preservation Zoning ordinances to maintain and promote agricultural activity, restrict non-agricultural uses, and minimize conflicting land uses.
Restrictions: Zoning laws can limit a buyer's ability on how they may use the property. For agricultural properties, the focus often is on preserving the farm economy and preventing urban sprawl.
Encouragements: The state encourages the use of farmland primarily for agricultural productivity, assessing land value based on actual farm use, rather than potential residential or commercial development.
Purchasing Procedures
The purchasing process involves several steps that must be understood and followed with precision.
Title Search: Essential to identify any encumbrances or legal issues attached to the property.
Environmental Concerns: It's vital to confirm whether the land falls within designated flood zones or contains wetlands, which could impose restrictions or call for specific permits.
Permit Type Required Action WPDES Permit A written agreement for transfer submitted to the DNR Zoning Change Approval from county board may be necessary
Potential buyers must also consider the size of the property, as it may affect zoning classification and permissible uses. It's advisable to consult with legal professionals to navigate these procedures effectively.
Financial Aspects of Farmland Investment
When considering the financial aspects of farmland investment in Wisconsin, investors should focus on the specific costs associated with purchasing and owning agricultural land. Precise calculations and tax considerations form the crux of financial planning in farmland investment.
Calculating the Purchase Price
To determine the purchase price of farmland in Wisconsin, a potential buyer should consider recent farm sales and current market trends. For example, the average price of agricultural land in Wisconsin was reported at $5,551 per acre in the previous year, showing an 11 percent increase from 2021. High-quality farmland can demand prices upward of $10,000 per acre. Calculations should include:
Market Analysis: Reviewing comparable sales to determine a competitive offer.
Land Quality: Assessing soil fertility, crop yield potential, and existing infrastructure.
Understanding Property Taxes
Property taxes are a notable factor in the ongoing costs of owning farmland in Wisconsin. Investors should recognize that despite the potential for low tax benefits, agricultural zoning can have tax implications. An investor should investigate:
Tax Rate: Determining the local tax rate for agricultural land.
Zoning: Ensuring the land is zoned appropriately and adhering to regulations which can affect taxes.
Farm investors are advised to carry out a thorough exploration of these financial aspects to build a solid foundation for their investment decision.
Steps to Purchase Farmland
When looking to buy farmland in Wisconsin, prospective buyers should systematically approach searching for properties, making an offer, and finalizing the sale. Each phase requires careful attention to legal requirements, property specifics, and financial considerations.
Searching for Properties
Buyers should start by identifying their specific needs, including property size and acreage. A variety of online listings and local real estate agents offer resources for finding available farm land. It's important to consider the land's soil quality, access to water, and available infrastructure. They should also be aware of regulatory issues related to agriculture and potential environmental factors such as wetlands or protected species on the property.
Research Methods:
Local real estate agents specialized in farmland
Online farm land listings and regional maps
Check Wisconsin Department of Natural Resources (DNR) for any land use regulations
Making an Offer
Once a suitable property has been found, the buyer needs to consider the value of the land. Conducting a comparative market analysis or hiring an appraiser can provide insights into the farm sales market. When ready, they will draft a formal offer, often with conditions such as passing an inspection or securing financing, and submit it to the seller.
Considerations:
Comparative market analysis or professional appraisal
Potential contingencies (e.g., financial, inspections)
Drafting a formal, written offer
Finalizing the Sale
The final step includes a thorough review of all legal documentation by both parties. This process involves securing financing, performing necessary inspections, and verifying no encumbrances on the property. The closing procedure concludes with signing the sales contract, paying any applicable fees, and transferring the deed. Buyers should ensure a clear title and may consider purchasing title insurance.
Closing Checklist:
Secure financing approval
Complete all required inspections
Obtain a clear title and consider title insurance
Sign sales contract and transfer deed
