The dust has now settled on the 2016 Ranch Market, and it’s time to establish the current market for the year 2017. You want to know because you intend to purchase a ranch this year. Or, perhaps you intended to find one last year, but didn’t, for one reason or another. And perhaps you intend to study it this year, preparatory to your engagement with it the next year. In all cases you want to know everything that’s on the market, which may meet your needs, and what the RELATIVE values of those properties are, so you can evaluate and choose the best for you when it’s time.
So, how to start? Start by knowing the Entire Market! You can’t very well ask for, or buy something that doesn’t exist. And without market knowledge, your expectations may be unrealistic and hold you back unnecessarily. Just bad planning.
This much is true: Only when the Entire Market is known, can the best choices be known as well. Apples to Apples and Oranges to Oranges; it all starts with a complete general market analysis, and that is where we will start today. Here’s an example:
Today there are 170 properties on the market that fit my profile for analysis, and define the Entire Ranch Market. These are recreational ranches of every sort, large and small, Hunting, Fishing, Cows and Production.
Let’s see how that works for someone in the market for a property priced from $2-$5 Million. We first look to PRICE, it is the BASIC PARAMETER. Everything in your price range. Price is by far the most limiting parameter you will have… you will buy within a range you can afford. Once your price range is determined, you begin looking for the best value in terms of price per acre of Comparable Properties, determined while considering Location, Improvements, Best uses, and Exit strategies, among many other things. So let’s look at pricing in the current market:
Here’s how the market prices itself out this year so far:
Breakdown of 170 RANCH PRICES, there are:
So, now we know that there are 64 ranches available in the market priced from $2-$5Million, representing the biggest block of the market. Next we want to know the relative values of the ranches in this segment, so we can eliminate the ones that are grossly overpriced comparatively speaking. We look to an adjusted Price/Acre, and here’s where the entire market ranges:
This shows that a good place to look for values would be in the price/Acre range of $1,000-$5,000/acre (which encompases72% of the market, throwing out either end).
So, by looking more closely at the specific 64 Ranch Properties that fall in the $2,000,000 to $5,000,000 PRICE range, we will see that the
Of that group, 32 of them are priced below $2,700/ACRE! Well below the $5,000/Acre at the top of our range, and WELL BELOW the average price per acre of that group! Now we are on to something!
That’s where to start the search for the best value for the price in that market… and there are some real beauties there!!! I’ll provide the list in upcoming BEST LISTS. This is just a short example of a different way to think… please examine the rest of this site for further insights to the new paradigm of Ranch Market Valuation for BUYERS.
Once you know the market, you know the BEST choices! Otherwise you are dependent on somebody else’s opinion of best value… and that is not nearly so real…Did you see them all? Did they? I’ll be back in a few weeks with a BEST list of a specific market segment, where I list multiple of the best properties on the market, and tell you why they represent the greatest values. For sure.