Does your family have a family farm that lately has been causing more headaches than happy memories? Let’s face it. Managing a farm on a daily basis is no easy task. While it may have been successfully run in the past by other generations, it doesn’t mean that you are required to keep it going. If your family farm is too difficult to maintain and is causing friction within your family, keeping this farm for the long haul may not be the right move. At Dunncreek Advisors, we aren’t here to make this difficult decision for you, but we are here to help guide you through this and ensure that the financial side of the decision is taken care of for you.
Hot Market
While deciding to sell the family farm can be an emotional rollercoaster, seeing the actual price tag of the farm can sometimes help you change your mind. Taking care of your family is the number one priority and right now the real estate market is hot! You may want to take advantage of selling while the market is high so that you can make the most money for your family. Waiting a few more years could mean the difference between a big payday and a mediocre one, so don’t let hesitation cost you significant money.
Financial Items to Consider
When deciding on whether or not to put the family farm on the market, in addition to the health of the real estate market, you may want to consider the following:
- Sell When the Family is Happy - The worst time to sell the family farm is when your extended family is fighting. Waiting until you and your relatives can’t agree on anything is not the right time to sell. Instead, sell the farm when everyone in the family is getting along.
- Do Something Fun - It’s not a good idea to spend all of the earnings from the sale of the farm, but it may not be a bad idea to invest in something fun for the family. Consider using a little of the money to purchase a cabin, lake house or beach house where you will be able to make lasting memories and reflect on how meaningful the farm was for the family.
- Understand the Taxes - Seeking guidance from a tax or financial advisor is a good decision as selling a large property has many tax implications.
- Don’t Sell to Your Renter - When you sell to someone that you have a relationship with, chances are that you’ll sell at a discount. Selling to someone you don’t know will allow you to get the most money for the family farm.
If this article has you starting to think about what to do with your family farm, get in touch with my office at rdunn@dunncreekadvisors.com. I always enjoy meeting with people who have begun this process. Dunncreek Advisors does not provide legal or tax advice, nor is this article intended to do so.