Money Talk - Should We Buy the Farm - Your Answers!

A while back, I asked you if we should buy the farm. As in, the family farm:

I know what you’re thinking:
That’s crazy!
To us, though, it’s not. See, my husband’s parents live on a farm that has been in the family for about 75 years. It’s not a working farm anymore, but for tax purposes, it qualifies as a farm. It is 80 acres of beautiful land, including a lake, recreational acreage, as well as tillable farmland. The Big Guy moved there when he was 13, so he has strong ties to it.
In a perfect world, I would love to have unlimited resources to clean up the farm and make it just beautiful land for my viewing pleasure. I would love to build a house overlooking the lake, maybe rent out the tillable land, and just enjoy owning 80 acres. I really have no desire for it to be a working farm. But, there are many things to consider……Read the full post

I wanted to thank you all for your thoughtful answers, from those who actually live on farm, to those who are worried about the family situation, as well as share some of the really helpful things ya’ll had to say!

Mrs. PoP had a really great thought: “If it’s really what your husband wants, why not make a deal that he needs to earn enough in side income (since he’s a SAHD these days, right?) to cover X% of the down payment. Over 3 years it’d be something like $1000/month” I actually really like that idea, and The Big Guy and I have something in the works that you’ll hear about later. Also, he mows lawns, and we’ve been socking that money away in savings. Right now the intent is to use it to pay down debt, but it could easily be repurposed.

Reader Heather who currently lives on a farm had some good questions as well: “You will have to figure higher maintenance and upkeep costs for the farm also……” Heather had more specifics on the topic, but the jist of it is that while I know that expenses are going to be higher, I have absolutely no idea how much higher!

Mrs. Frugalwoods got right to the heart of the issue for me: “The family part of the equation scares me though. Buying property from relatives has a potential to go really wrong… and it already sounds like it’s a sore spot in the extended family. Maybe it’s worth looking at other plots of land in the area to get a good idea of the family land’s real worth.” The land is definitely a sore spot amongst family, but not because anyone wants the land itself….they all just want the money. How sad….

Lastly, Laurie, who blogs over at The Frugal Farmer (great blog, you should check it out) said this: “I always like to kind of think worst case scenario when making decisions like this. Ask yourself: What if I didn’t/didn’t want to have a job that makes 75k a year? What if I couldn’t build there and had to live in the old farmhouse forever? What if moving here meant I couldn’t retire by 40 – would I be okay with that?”

The questions you all asked (Laurie especially) really made me wonder. Is this what we really wan to do? Is it worth sacrificing some of our financial goals?

Bottom line is this: We are not 110% sure that buying the farm is for us. We definitely want to, but we’re not completely sold on it.

But we have 3 years, at least, before it’s going to be an option, and quite frankly, no one else wants it, so time is on our side. In the meantime, though, we’ve come up with a game plan:

So here’s our plan:

Get a formal appraisal done: As so many of you pointed out in the comments, Zillow’s estimates are pretty worthless. This way, we can get a baseline price, so my father in law will stop thinking it’s worth $500K….cuz we’re really, really not paying that.
It can go no further until I see paperwork. The will, the mortgage and everything else will have to be seen with my own two eyes before we put any more money into than the appraisal. With this family, everything involving money is shrouded in mystery, and I am having absolutely none of that – especially where my hard-earned money is concerned!
If the paperwork is produced, we would look into securing financing. No payments to family. Just a regular ‘ole mortgage. This includes getting our down payment together like Mrs. PoP pointed out.
Convince relatives to take a one time payout. I’m not going to make payments to relatives. I am going to make payments to a bank, like a normal person. The plan is to offer them each a payout that amounts to their 1/5 of the balance still owed on the loan. (There are 5 family member receiving equal payments, thus the 1/5)
If that doesn’t work, then my in-laws are stuck with it.

We would love this piece of land, and I would love for our daughter to grow up there. Great school districts, beautiful views, and in an area in which the value of the land should only go up.
However, it comes down to this:

I (and the Big Guy) are not willing to sacrifice our financial goals for this.

No piece of land is worth that.

I do want to mention, though, that we did come across this awesome post by Whole-Fed Homestead: How to Protect Yourself When Buying a Farm or Rural Property. If you’re looking at rural land, this is a great place to start!

I would love to hear what you think! As always, ya’ll have amazing advice. What do you think of our plan?