An Inheritance is a Gift Not an Entitlement

January 7, 2022

While cleaning out our office desk at the farm, I came across a piece of paper with my grandma’s handwriting on it saying, “An inheritance is a gift, not an entitlement.”

I’ve been thinking all week about that phrase and how I can apply it to my own life. Being a farmland auctioneer and land agent, time and time again I’ve seen the greatest number of tears, arguments, and confusion come from inheriting parent’s personal possessions and property. Especially when inheriting the family farm with siblings and family members.

Inheriting the Family Farm

My Grandma Hoy passed away in December of 2020. My father inherited the family farm since he is the only survivor (besides my sister, half-brother, and I). Even though there were no fights over settling her estate due to only going to one heir, I can’t help but think what it would’ve been like if my dad’s brother was still alive. It makes me sad when I see families torn apart after their parents pass due to fighting over their inheritance gifts. It may surprise you but it happens more often than you think! Especially if there is already tension between siblings.

I’m extremely lucky and grateful for having a family farm! In 1944,mMy great-grandpa Ed bought our farm in Redfield, IA. My family has worked hard to keep it in the family ever since. My grandpa Hoy was the youngest of his siblings. After returning back from serving fro our country, my great-grandpa sold the farm to him. In 1958, my grandparents got married and two years later had my dad – a baby boomer. In 1964, is when my uncle was born but he passed away when he was 20.

I’ve seen my dad and grandparents work 24/7 on our farm. I can’t help but think what my life would’ve been like if I didn’t grow up as a farm kid. Agriculture has always been a big part of my life and my dream is to keep the family farm going. From the disputes I’ve seen between co-heirs, it makes me nervous for what will happen (God willing) when the farm is passed on to my younger sister, half-brother, and I. We all get along so extremely well currently! I don’t think the farm would ever tear us apart, but it’s always good to talk to one another about what will happen and Dad’s wishes for us.

Inheriting the Farm with Siblings

How to sell the family farm

Between my siblings, I’m the most involved on the farm. My half-brother lives in North Carolina with his family and my sister doesn’t have the passion like I do for livestock and agriculture – which is okay! However, I do want them to enjoy the family farm and inheritance just as much as me without any fights. My half-brother and I often talk now about how we will do anything to keep the farm going. He loves riding dirt bikes, hunting, and having a place to escape and be free. This all makes my worries of ever fighting over the farm low.

Continuing the Family Farm After Inheritance

We are in the process of making sure Dad’s will is detailed. It will describe the roles and responsibilities of my siblings and I’s part of the farm after he passes. This will ensure the family farm continues and how we will receive his inheritance.

Talking about wills and what will happen after your parents’ pass is no one’s idea of fun. However, a well-planned, well-executed will can prevent family conflicts after a loved one passes. Again, FAMILY FEUDS OVER INHERITANCE HAPPENS MORE OFTEN THAN YOU’D LIKE TO SEE!

For many, it is not all about the money. Some are okay with having memories of their parent’s belongings. Others will argue over china sets, photo albums, tractors, and more. These fights are ugly and can split families forever unfortunately. You don’t think it will happen to your family and loved ones until it comes down to deciding who gets what and greed that sets in.

Arguments over inherited items and property can last for well over a year. I’ve seen this first hand as a farm real estate agent and auctioneer. Many of the fights are not over the items and land itself but working out old issues with each other and sibling rivalries.

You can easily picture siblings say things like “sibling a has always walked all over us” or “sibling b has always gotten the better deal”. It’s so expensive to fight these family disputes over family possession in court. Some people wind up spending MORE on legal fees than the estate is even worth.

Farm Estate Planning

Dying without a will or with a poorly drawn will can produce some truly awful results for your family. Even worse, your money and property can wind up in the wrong hands or in unexpected hands. How can you avoid these difficulties? I recommend hiring an experienced estate attorney to draft a comprehensive will. Iowa State University also has great resources for estate planning which can be found here.

Aging parents should ask their children what things they want most. Then make a hand written addendum to the will, bequeathing the most financially or sentimentally valuable items to specific individuals. Heirs might not get exactly what they want, but allowing people to speak their piece goes a long way towards PRESERVING family ties after the surviving parent passes away.

An inheritance is a gift not an entitlement. It’s not something you should take for granted. Those who do, can get themselves into deep financial trouble and cause long term family fights. Wills, lawyers, and deceased parents do not shatter family bonds. Survivors do or don’t depending on which they value more their brothers and sister or dollars and property.  

Inheritance Problems with Farmland

If you’re struggling with co-heirs over inherited farm real estate, reach out. I understand the situations you might be in and can provide some relief. I also provide tips on how to sell the family farm. If that is your goal and wishes you can read more here. Feel free to contact me with questions by emailing me at Rachel@DreamDirt.com or call me at 515-954-8063.

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This Old Farmhouse

January 5, 2022

Old Farmhouse Decor and Nostalgia

Yesterday, I made a TikTok video about things in our 1900’s old farmhouse that just make sense. I received a lot of interaction and comments on it. Here’s the video.

@iowafarmlandrealestate

Comment if you live in an old farmhouse! #oldfarmhouse #iowa #farmtok #old #toytractors #barncats #farmhousedecor

♬ Che La Luna – Louis Prima
Old farmhouse decor

You can see many people commented saying things along the line of “yup, that looks like my parent’s house or where I grew up”, and “looks homey”. I couldn’t agree more with them! Even though somethings make me laugh like the really old carpet, wood furnace, wood paneling, tractors for décor, basement full of chore clothes, and barn cats that come inside – I can’t thank my family enough for providing me with a farm to grow up on.

Visiting Grandparent’s Iowa Farmhouse

When I was a little girl, I LOVED coming over to grandma and grandpa’s house to the farm. My parents, sister and I lived on a small acreage outside of Adel, IA and the farm is outside of Redfield, IA. I would tag along with my grandparents during the day while my dad was at work and mom was resting or getting chemo treatments for her Breast Cancer. I remember helping with livestock chores and playing in the corn piles. Here’s a photo I recently came across of me and my grandma in the feed shed. My grandma was very active on the farm. She would take me along in the tractor (with my car seat). I believe this is where my love for agriculture stemmed from. My grandpa also had a few bottle calves and lambs. I vividly remember helping him mix bottles and feeding the babies.

There was something about pulling in and out of my grandparents drive that made my heart warm. I was always so excited to walk up to the door and give my grandma a hug on Sunday’s for dinner when I was in my teenage and college years. Also turning around in the car and waving out the window to her as we left to head home to our place by Adel made me smile. I could always count on her hugs and waves goodbye.

Living in an 1900’s Farmhouse

Life is a little different now. December 2020, I hugged my grandma for the last time and the farmhouse became my Dad’s. The move from Adel to Redfield early part of 2021 was extremely hard on my Dad, sister, and I. But the idea of finally living back on the farm excited my Dad. This is where our cows are, crops, and farm equipment. The only updates we did to this old farmhouse was paint the two upstairs bedrooms white instead of the blue color. After recording my TikTok yesterday, I’m starting to think that this house is fine just the way it is. Not many others have the luxury of living in an old farmhouse that their family worked so hard for. I am trying to convince Dad to at least tear up the carpet upstairs since there’s nice hardwood underneath.

Wednesday, January 5th, 2022

I’m really enjoying writing these daily blogs each morning. It’s a great way to start my day and helps me put my thoughts down on paper. Since I work from home as a farmland auctioneer and land agent for DreamDirt, I have to keep myself motivated throughout the work day. These more personal lifestyle blogs help me prepare for the day and encourage me to keep working hard. I do write blogs about farmland in Iowa on our DreamDirt page. You can read the most recent one here.

Hoy Family Farm

To wrap up, even though my last name changed to Tiffany October 9, 2021, I will always be a Hoy. My grandparents farm in Dallas County, IA will always be the Hoy Family Farm. The nickname, “Hoy Boy” will stick with me forever too!

Stay warm out there! Currently only 5 degrees and the wind is brutal.

Love,

Rachel

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Family Farm History

January 4, 2022

Tuesday, January 4th

Woke up to another beautiful sunrise in the farm and thought, “it’s only TUESDAY?”. This is going to be a long week. Then I remembered that I enjoy what I do during the day and it doesn’t have to feel like work. I get to be myself with my job at DreamDirt. Having a flexible schedule is rewarding and I can structure my days how I’d like to accomplish tasks. Yesterday, as a farmland auctioneer and land agent, I wrote a blog about what I think the farmland market will look like in 2022. You can click here if you’d like to read it.

The blog took me a majority of the morning. It’s full of great information about whether or not to sell farmland this coming year while prices are still record breaking high. Took a quick lunch break with Dad and enjoyed some pizza from Casey’s (yes, pineapple does belong on pizza). After lunch, I looked up some names of agriculture attorneys in Iowa that we would like to partner with this year. We are looking to help their clients sell land by auction or listing with our services if needed. Fill out this form to contact me about selling farmland.

Farmland Seller Course

I also worked on editing a video. I recorded a short video about auctions versus listings for my new Farmland Seller Course. Which I hope to release soon! There will be about 10 videos with secrets, tips, and a ton of great information for anyone thinking of selling land! I hope my videos will be helpful for those that enjoy listening or watching videos instead of reading blogs. I tried to keep the videos as short and concise as possible. The majority are only a few minutes long! I address common questions I hear and topics you should understand as a land owner in the videos.

Feeding Cattle on Family Farm During Iowa Winter

Our cows were out of hay already from the bale we gave them Friday. I helped Dad give them another big bale yesterday while it was warm enough for the tractor to start. It made me nervous when I saw the tractor start sliding down the hill on the snow and ice and hoped it wasn’t going to flip over with my Dad in it. Thankfully, it didn’t and he said, “I think it needs new tires”. Yes Dad, please don’t ever scare me like that again and buy some new tires for snow and ice. Here’s a Tik-Tok video of how giving the cows a new bale of hay went!

@iowafarmlandrealestate

It’s the pink and purple pants for me 😆Also had no idea Spuds jumped through the bale ring till I watched my video and what cow knocked my phone down

♬ Stranger – Official Sound Studio
Feeding cattle in Iowa winter

Iowa Farmland Prices per County

I finished out the work day making a list of what I’d like to accomplish this week. I am going to work on making more short videos about farmland prices in Iowa per county. I’ve already started on a few and want to cover all 99 counties!

Hoy Family Farm History

Last night, Dad and I talked more about family history especially on the Hoy side. We were looking through old pictures of my great-grandpa’s family. All the pictures are in black and white and from the early 1900’s. I found out the my great-grandpa Edward Hoy was born in Pennsylvania and moved to Iowa when he was three. He grew up on a farm and went to Iowa State University for college and study agriculture – just like me!

Redfield, IA Farm

In the 1940’s is when my great-grandpa bought the farm in Redfield. It was so cool seeing all the old photos of what our farm looked like back then and the equipment they used and livestock they had. Horses, pigs, and shorthorn cattle all on this farm we still have today. One old barn from the photos is no longer standing. I could make out the majority of our farm in the pictures. My great-grandpa Ed sold the farm to my grandpa Howard Hoy who was the youngest child after he got back home from service. My grandma, Pat Hoy grew up in Earlham, IA and she worked right along with my grandpa running the farm. They were married in 1958 and had my Dad in May 1960 and four years later had my Uncle Tom.

John Deere pedal tractor and wagon

Looking at the old photos made my dad remember that they used to have an old projector that would show slides of pictures. We dug through the attic and found it! I’ve never seen one in my life. It’s an argus 300 projector and the photos we looked through were when my dad was only a few years old. My favorite picture is this one of my Dad and uncle in the yard with a John Deere pedal tractor and wagon which we still have! These types of pictures are so special to me since I was never able to meet my uncle Tom. He sadly passed away in a car accident when he was 20. I’m just now learning more about who he was and what he liked to do.

Vintage Argus 300 Slide Projector

There’s more slides of pictures that we’ll have to dig through and find in the attic. Learning about my family’s farm has been so intriguing and I want to continue raising cattle and growing crops for as long as I can and hopefully see the farm become a century farm!

May you have a blessed Tuesday and stay tuned for more!

Rachel

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Goals for 2022 and Weekend at Farm Reflection

January 3, 2022

New Year’s Eve

So much is on my mind right now for some reason. Thinking about what makes me happy, goals for 2022, what I should talk about related to farm real estate, my family’s history, and the family farm.

This weekend I’ve been home with my dad at our family farm outside of Redfield in Dallas County, IA. My husband, is currently in Oklahoma City for the Cattleman’s Congress Livestock Show for his job. When he is gone, I like to come hang out on the farm and stay with Dad for a few days and catch up.

Friday was New Year’s Eve, and I was going to go out and be with friends but we got an ice storm and roads were slick so I stayed home and was in bed by 9pm. I know right?!? I’m lame and getting old!

Who else did this?

Happy 2022!

Saturday we all woke up to a new year! Happy 2022! Like the majority, I wrote down my goals for the new year which I typically don’t do, however I really focused on what I want to accomplish this year and task that will help me accomplish those goals. I also jotted them down in my notes on my phone so I can look at them every day. Why not put my goals where I can easily access them instead of a journal or notepad? I also am liking the idea of making a dream board so I can visually see my dreams when I’m in my home office to keep me motivated. Here are my goals for 2022 and tasks to keep me accountable:

Goals need a plan and actions to help you achieve your goals

My 10 Goals:

  1. Do things that make ME HAPPY
    • 1. Action: Find at least one thing that makes me happy and add to 365 list each day
  2. Spend more time with Family and Friends
    • 1. Action: Set phone down when with company
    • Action: Schedule more dates and say yes for meeting up!
  3. Make more improvements on the farm
    • 1. Action: Be more present with Dad when home and utilize his help
    • 2. Action: Get outside!
    • 3. Action: Start on small projects
  4. Be more spiritual and practice my faith
    • 1. Action: Journal
    • 2. Action: Recognize signs from angels
    • 3. Action: Pray during the good and bad
  5. Be more active
    • 1. Action: Move my body for 5 minutes if I don’t feel like working out – should encourage me to keep going and complete 30-45 minutes of exercise
    • 2. Action: Take Dude on as many walks as possible!
    • 3. Action: Sign up for classes at the Crew Center
  6. Be a loving wife
    • 1. Action: Get ready in the mornings even though I work from home
    • 2. Action: Ask how Bryce’s day was and don’t complain about the small things
    • 3. Action: Set phone down at night when together and talk about our future, our goals, learn something new, our cattle herd, etc.
  7. Grow my farm real estate business:
    • Action: Create content for sellers and buyers
    • Action: Show my face more and network
  8. Eat a balanced diet
    • 1. Action: Portioning plate and include all varieties of food categories
    • 2. Action: Allow myself to have cheat meals follow 80/20 rule
    • 3. Action: Try new foods! Order Hello Fresh and Whole and Hearty Meals To – Go
  9. Drink Less Alcohol
    • 1. Action: Drink at least 100 oz of water per day
    • 2. Action: Only drink socially
    • 3. Action: Focus on progress and take it day by day
  10. Read before bed
    • 1. Action: Set phone down at night
    • 2. Action: Buy used books and sell ones I have read
    • 3. Action: At least 10 pages

Weekend Re-set

I’ve always been an open and honest person and sharing my goals to the public is uncomfortable but I hope it inspires you to try some of my goals and action tasks as well!

Now back to the weekend, I had a very relaxing snowy Saturday! I did clean up Dad’s house some, worked out, read, and went outside for about 5 minutes since it was COLD!

Sunday, I was up before 8am and Dad had already done chores. I’m determined to get out of bed one of these mornings early to help feed cows while I’m home! There’s something so rewarding about feeding livestock the depend on you it’s hard to describe but it always puts me in a good mood even if it’s below zero!

Farm House Projects

I asked Dad what projects I could help him with and we decided it was time to clean and organize the office room. It’s been a hard year on our family since my grandma passed away December of 2020. We spent majority of last January and February moving into the farm house and it’s hard knowing what to keep, give away, sell, or throw away. I feel so guilty trying to update and make grandma and grandpa’s house our own and changing out a few things. Going through the office though was a good first step.

My sister and I did do good work on the upstairs bedrooms this past year but the main floor and basement could still use some work. The office looks so much better and Dad was thankful I kept after it all day. Finished the evening by watching some football, doing some yoga and stretches and reading before bed.

Monday Morning Motivation

This morning I took Dude, my golden retriever, to the vet for his annual wellness exam at Adel Vet Clinic and grabbed a coffee from The Morning Grind. The roads are still covered in snow and icy in areas but not terrible.

Today I am focused on growing my business and how I want my work days to look like. I’ve been with DreamDirt for a little over three years now and am a full-time farmland auctioneer and real estate agent. I love creating content on social media for sellers and buyers and communicating with clients. If you’d like to see some short videos about farmland in Iowa follow my Tik-Tok and Facebook page! Helping land owners become more educated on the farmland selling process is my main priority, and I enjoy answering your questions!

Future of Farmland

Farmland Seller Resources

I have several great free resources if you are ever in the position of selling farmland or know someone who is! All you need to do is fill out my contact form and I’ll get back to you ASAP! I offer free farmland market evaluation consultations and please think of me and the team at DreamDirt when it comes to selling farm real estate.

Take care and stay warm!

Rachel

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How to sell the family farm

How To Sell the Family Farm

August 24, 2021

Deciding to sell the family farm is one of the most difficult decision to make. I grew up on our family farm in Iowa that my grandparents bought back in the 1940’s. I enjoyed following my grandparents around doing chores while I was young, riding in tractors, and playing in the dirt. Now that it is just my dad and I running the farm, I could never imagine selling it. I know the emotional connection you have with your family’s farm and how hard this decision can be. However, sometimes it’s the only choice and what’s best for you and your family.

Inheriting a Farm with Multiple Family Members

Being an auctioneer and realtor, I’ve heard time and time again, “our mom/dad just passed away recently and now my brother/sister(s) want to sell the land we inherited”. Most often, the sibling I talk to is the one in charge of the estate or the sibling that has been farming the land and doesn’t want to agree to selling. Not only do I understand what it’s like to grow up on a family farm but also the, “I’m the only sibling that has interest in farming or does all the work” feeling. I was definitely the “tom boy” growing up between my younger sister and I. Even though my sister enjoys hanging out on the farm on the weekends and checking cows, she just doesn’t have as much passion and interest in farming as I do. Which is okay.

How to Decide if You and Your Siblings Should Keep the Family Farm

I know we are not the only siblings this way. It can be frustrating when it comes to deciding wether to keep or sell the family farm you now inherited. Or if you are reading this and deciding whether or not to sell your land or pass it on to your family, here are some secrets and tips.

Having the Important Conversation Now

I wish more families would talk before the passing of a loved one. My grandma got sick fast and passed away quickly, leaving the farm to her only living son, my dad. We know that her and grandpa’s wishes are to keep the farm running. If we ever get into financial troubles then it’s okay to sell a certain part of the farm. My dad and I know keeping the farm is best for us right now and we enjoy having it.

What is your plan?

However, this isn’t always the scenario for other families. I’ve seen siblings fight over what to do with the family farm and tear their relationship apart. Most often because of greed and other conflicts. I know that this is not what their parents would want. This can easily be avoided and save relationships if settled before the land owner passes. No one is promised tomorrow. It’s critical to have the conversation of what will happen with the family farm and have a plan. So what are the options you have for transferring the farm to your kids or other family/friends?

Farmland Transition and Estate Planning

How’d the conversation go with your the rest of your family? Do you know who would continue the farm? Do you know if some of your children could use the money now instead of owning land? Are any of the kids interested in owning the family farm? Are medical bills pilling up? Would you like to enjoy your hard work of farming over the years and retire? Depending on how you answer these questions, more than likely I would suggest selling now or dividing the land to inheritors now.

But you’re only saying this because you’re an auctioneer!

No, I’m saying this because of the drama that comes once you have passed. When there is no clear plan of what happens once your family inherits your land, this causes frustration, anger, and confusion. I see it all the time being an auctioneer. When more than one person inherits the farm, there’s always tension between members and emotional stress. My best advice is to sell your land now or divide the land to have only one owner. Here’s why.

Benefits of Selling Farmland to Avoid Family Conflict

Let’s continue with the scenario of one sibling wanting to keep the farm and continue farming and the other sibling does not and would rather have the money. As the landowner/parent you are faced with the difficult decision of deciding to sell now or let the kids figure it out when they inherit it. To avoid family conflict, I recommend selling now. Money from selling the farm can easily be split up compared to splitting the farm between multiple family members. If you’re worried about your child that still would like to keep the farm, as auctioneers we can help sell land to family members. We can do this by giving family per bid discounts. This allows them to have a fair chance at purchasing the land at a discount.

Dividing Farmland

Or you could divide the land first. Then each sibling can better decide what they want to do with the part they inherit. You could even keep the part of the farm your child who farms currently and is interested in keeping for future years, and allow them to rent it from you. That way you have still have income during retirement years. Selling the farm now could also allow more flexibility of where each kid would like to farm.

The Family Farm is Not Everyone’s Dream

Have your children moved off the family farm and staring their own farmstead across the state? Would they like to re-invest the money into farmland closer to where they live now with a 1031 exchange? Are they trying to start their own business or need the money to cover expenses? Emotions play a great role when selling a family farm. Realistically, money can be split more evenly. Which won’t cause the family to tear each other apart compared to dividing the land. Everyone has their own passions and dreams. It could be very well that the family farm is not someones passion. As I mentioned above, I have the passion for continuing our family farm but my sister does not. However, I know she still deserves to enjoy the benefits to the family farm. She should earn income or money from it just as much as I do.

Continuing the Family Farm

Many of my clients who have inherited the family farm have said that they grew up on the farm in Iowa, but now live in a different state. It’s often difficult to let go of things that meant so much to you and your loved ones. If you don’t have interest in farming and nervous about the idea of selling and letting go, I encourage you to think of all the memories you have of running around on the farm as a young kid and write them down. This often helps my clients realize that memories will continue forever. Even if the farm doesn’t continue on in the family and share these memories down the road. You could also continue the family farm by renting out to someone interested in farming!

Farmland Buyers

As an auctioneer, we can set up an auction for rent instead of selling the farm. It may surprise some people that our most common farmland buyers are still farmers themselves and not investors. If you’re thinking about selling, you could give the chance to a farmer looking to expand his operation. Or help a beginner farmer start his/her dream! The possibilities are endless and I’m here to help you through the process. I will listen to your ideas and wishes.

Helpful Resources for Transferring and Selling Farmland

Fear of what will happen to the family farm doesn’t need to cause you stress. There are several free resources to help you through the process of transferring the family farm. Iowa State University Extension and Outreach has several great resources to learn from for transition and estate planning. Resources can be found here. As someone who also understands grief and farming, I’m always here to answer your call or message. Don’t know where to start? I can make the process easy and comfortable for you. Let me handle all the details and answer your questions. I might be an auctioneer, but more importantly I will be your listening ear through everything. Whether you would like to vent or share memories, you can call me any day!

Rachel Hoy 515-954-8063

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Iowa Farm Lease Termination

How to Terminate Farm Tenant and Lease in Iowa

August 20, 2021

Steps to terminating a farm tenant

If you are thinking of selling farmland in Iowa in the upcoming year, it’s best to terminate your farm tenant now! This is because when the farm trades hands after selling, the new owner will now have rights to the next year’s crop. As long if the farm lease has been terminated properly. You can still sell farmland with a tenant. However, it is typically more appealing to farmland buyers if there is not a tenant the year they take possession of the farm. I can help you structure your land auction to provide rent credits and possession rights to the high bidder if you decide to sell during next year’s crop season with a tenant. Follow these easy steps to terminate a farm tenant in Iowa. If you have any questions email me at rachel@dreamdirt.com.

Be aware of September 1st Deadline!

In Iowa, as a landowner you have to give notice to your farm tenant that you are terminating the lease on or before September 1st of the current year. You can either serve the termination by certified mail or in-person directly to the tenant.

Print this Farm Lease Termination Letter from Iowa State Extension to terminate farm tenant

Click on the photo to open pdf document of this farm tenancy termination notice letter. Fill out respected fields and sign.

Mail the letter to current farm tenant through certified mail

Keep your receipt from post office showing proof that you sent by certified mail

Farm Tenancy will end the following March 1st

If you do not meet the September 1st deadline, the farm lease will automatically re-new under the same conditions and terms of your current lease. Once termination has been given on or before September 1st, the tenant will have tenancy possession till March 1st.

Next steps for selling farmland in Iowa

Are you thinking of selling farmland in Iowa? Fill out my questionnaire and get started on learning how to sell your land today!

I’m interested in learning more!
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5 Ways to Save Money When Selling Farmland

June 18, 2021

Farmland owners! Are you thinking of selling some farmland real estate and concerned about how much it will cost to sell? You can certainly try to do for sale by owner. I’m not stopping you from trying but there are some dangers that come with FSBO. Instead, try these 5 cost saving tips when choosing to sell by auction or listing! Save your money!

Want to save over half of commission costs? Hire an auctioneer instead of realtor!

I come from an auctioneer and realtor background. I’ll be the first to tell you that hiring auctioneers will save you thousands! Typically, realtors will charge you twice as much in commission costs compared to auctioneers! Realtors will often split commission with a buyers agent so you are paying 2 agents instead of 1.  You are paying for your agent and also the buyers realtor! To compensate for the cost of the additional brokerage coming from the buyer’s side, a listing realtor will typically charge more than double! In-case they need to split the commission 50/50 with buyer’s side. This is why hiring an auctioneer can save you over half of commission!

At DreamDirt Farm and Ranch Real Estate where I work, we don’t offer cooperative brokerage for auctions in most cases. It’s not necessary and does not serve our client well. We are dedicated to finding buyers for your property. Since your auction is open to the public, and with our exceptional marketing and advertising, buyers are able to find your land auction and are welcome to bid! Realtors often ask us to share commissions on our auctions hoping to bring the buyer. However, we’ve found that with our advertising on Zillow and many other aggregation websites the buyers are already exposed to the listing. Buyers agents never serve to improve the outcome of your auction . This helps you save money on commission costs since you are only paying us and not the buyer’s agent. Our commission is typically 1-5% for land auctions, which is considerably low compared to 5-10% realtors charge. 

Choosing an Auction over a Listing for Sale can save you money and time!

If the first money saving cost tip didn’t convince you to market your property by auction, here’s another reason! 

Our auctions typically take 60 days to complete. This includes 30 days of having your auction open for bidding. Followed by 30 days following for closing process with new buyer. We have found 60 days to be extremely effective! The 30 days gives us time to get marketing and advertising out the door. This gives bidders plenty of time to arrange financing. When compared to a listing, auctions create a sense of speed and urgency to get bids in on the property.

Listings don’t have a date attached. This gives buyers more time to dwell on the idea if they want to put an offer in or not. Some buyers like to wait the seller out and wear them down.  Some of our past sellers have even mentioned they have tried selling their land to neighbors. The neighbors said they had interest, but the sellers never got a clear answer or offer right away. Once they hired us to do the auction, then the neighbors saw the sellers were serious about selling! Bids were placed before time ran out for opportunity to purchase neighboring land.

The 60 day time frame is also a huge plus when it comes to costs and saving money!

When selling property, you need to keep in mind that you continue paying taxes, insurance, and maintenance in the time period of selling. With a 60 day auction process, you can save thousands when compared to if your listing took longer than 60 days. Imagine if it took an extra 6-12 months to receive an offer. You’d be done paying on taxes, insurance, and extra costs months ago if you did an auction!  Not only do you save that money, you put it to use earlier on something which contributes to more saving.

One last tip for choosing the auction method, is to have an online only timed auction! Live auctions where bidders come to hear an auctioneer chant are typically more expensive to the seller. This is because you’re incurring more costs for more peoples time, costs of the venue, travel, refreshments for the crowd, printed items, insurance, and set-up fees. Hint: Ask to have an online only auction to save more in commission and fees. 

Choose the right marketing package! Do you need the whole works or just want a little advertising?

This is where you can save some GREEN! Advertising cost add up fast! At DreamDirt we charge no marketing and advertising fees for properties valued over $250,000. If you’re curious of how much your property is worth contact me today! Other companies may charge you for newspaper ads, flyers, drone video, postcards, digital ads, etc.! If a company you are interested in charges for marketing, make sure you understand where exactly your money is being spent. Some of our past sellers who didn’t meet our free advertising offer have decided to have us use photos instead of a video, and digital ad instead of print advertising.

When deciding how much advertising you want done for your farm, also take into consideration the quality of the marketing. Does the company produce appealing flyers and videos? Do they make it all in house or hire a third party? DreamDirt’s advertising is done all in house which makes it more affordable for our sellers!  

Commission costs still too high for you as a seller? 

Have you heard of Buyer’s Premium? It’s a way you can save on commission cost by charging the buyer a percentage on top of his final bid. This helps pay for costs of the auction. The auction serves the buyer and seller both.  With a 4% commission for example, you could pay for 2% and charge the buyer the other 2%. It’s completely up to you as a seller how you offer the property. 

With an auction you set the rules and the buyers bid accordingly. The buyer’s premium may reflect in the amount bidders are willing to bid. Bidders know they’ll owe and additional percentage on top of their bid and some it may not. We see it some in Iowa but other states and areas it’s more common. We just finished this auction with a 2% BP in Buena Vista County, IA and have also sold land in Kansas with Buyers Fee of 5%.

Compare several companies and don’t be afraid to negotiate costs and fees!

Most landowners only get one shot at selling land in their lifetime. My biggest piece of advice is to become educated on the process! Also interview companies you are interested in hiring to sell your most valuable asset! If you’re nervous about paying commission don’t be afraid to negotiate! It may surprise you what we can come up with. I’ve had sellers choose less commission percent but pay for marketing up front. The have set up a commission scale depending on what the farm sells for. Most choose the no risk option of only paying commission once the land is sold. At the end of the day, I want you to be comfortable with hiring me as your auctioneer at a price we can both agree too. I offer a free consultation and proposal for interested sellers to get started with the land selling journey. Start here today!

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Iowa Farmland Auction Update

May 5, 2021

Week of April 26th – May 2nd

Hi everyone! There were only two farmland auctions this week in Iowa. We are starting to see fewer auctions each week leading into the late spring/early summer crops now that everyone is getting crops in the ground. Here are the results from both farmland auctions:

Dallas County, IA 83 Acres Farmland Auction

  • City: Adel, Iowa
  • Live Auction Held at Redfield Legion Hall
  • 83 acres near KAO Campground and I-80 interstate
  • 72% tillable
  • Sold for $10,800/acre

Muscatine County, IA 349.51 Acres Farmland Auction

  • City: Nichols, Iowa
  • Live Auction Held at Lone Tree Community School Wellness Center
  • Sold in 5 Tracts
    • Tract 1 – 70.87 acres
      • Sold for $9,500/acre
      • 92% tillable
      • 74.1 CSR2
      • $140/CSR2
    • Tract 2 – 85 acres
      • Sold for $10,000/acre
      • 94% tillable
      • 76.7 CSR2
      • $139/CSR2
    • Tract 3 – 86.6 acres
      • Sold for $8,200/acre
      • 92% tillable
      • 68.9 CSR2
      • $129/CSR2
    • Tract 4 – 84.23 acres
      • Sold for $6,700/acre
      • Pasture
      • 66.5 CSR2
      • $100.75/CSR2
    • Tract 5 – 22.81 acres
      • Sold for $8,150/acre
      • Development
      • 54.9 CSR2
      • $148.45/CSR2

April Total Farmland Acres Sold By Auction: 3,501 acres

Thoughts from Iowa Land Auctioneer, Rachel

Now that we are 4 months into 2021, we are starting to become more aware of how the rest of the year may fold out. Commodity prices were gradually increasing throughout March and April, and have really hit some high prices! We haven’t seen some of these prices since 2011!

Supply and Demand

Coincidently higher commodity prices = higher land values. More farmers are looking for more land to farm because of the rise in corn and bean prices; which drives demand up. However, there is still a shortage of available land for sale creating low supply. Now I’m not an economic wizard, but I did take a few economy classes at Iowa State University while in college and what I learned was; when there’s low supply and high demand that equals higher prices. Just like what we are seeing with land auctions right now.

Are you looking to finally retire from farming and would like to enjoy all your hard work? Have you recently inherited some land and looking to sell all or part of it? Needing to downsize your operation?  

The key is, if you are slightly even thinking of selling farmland, do it now before everyone gets the right idea too! As a seller you want to sell while there’s still a low supply. Once more land comes to market in the Fall and after harvest, we might see a dip in prices than right now currently while supply is low.

So, if you’re thinking you want to sell now while the market is hot – I can help you adjust terms and conditions of your auction to reflect rent income or crop income for selling to a new owner half way through the crop season this summer.

I’ve been selling land for two and a half years now and have never seen such high land auction prices! I have the tools to help you sell land by live auction, online timed auction, or even listing at DreamDirt Farm and Ranch Real Estate, LLC. I can help you get started with the selling journey by creating a proposal and scheduling a free consultation with you! Fill out my questionnaire to get started!

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Pros and Cons to 5 Different Ways to Sell Farmland

November 22, 2020

Are you feeling confused on how you should sell your farmland? Here’s a quick checklist of the pros and cons to common methods of selling land. Choose one which best fits you and your farm, or reach out today to have a free professional consultation!

Sell by Live Bidding Auction

This is where people show up to a common place and the auctioneer calls for bids in-person on a certain day. Sellers typically come to live auctions and talk with their auctioneer during a “break” in bidding to discuss the price of where bidding is at. With a reserve auction, which is most popular, you as a seller have the right to accept the highest bid, reject it, or confirm the sale at your reserve price and sell to the highest bidder.

Pros

  1. As a seller, you set your own terms and conditions bidders have to agree to.
  2. Live auctions are widely recognized as the traditional way of selling land. 
  3. In this method, an auctioneer will chant out-loud and take bids. Creating a unique atmosphere that the public enjoys listening to.
  4. Some live auctions also include online bidding depending on the auction company. 

Cons

  1. Venue expenses to hold the auction can be an extra cost.
  2. Bidders experience social pressures and often become nervous bidding against friends, the farm tenant, and the public. Resulting in lower prices when compared to online only auctions.
  3. Live auctions are often stressful to you as a seller because you have very little time typically during the 10-minute break between bidding to decide if the price is high enough for you to sell your land or not with your auctioneer.

Sell by Timed Online Auction

In this method, all bidding is online and timed. Bidding is typically open for 30-45 days and the auction has a set date and time where bidding will end. I recommend online land auctions to all of my clients as the preferred method of selling land because of the benefits they provide compared to live in-person auctions.

Pros

  1. Bidding online greatly reduces bidder friction by taking away social pressures that are experienced at a live auction. The bidders remain anonymous online and can sit in the comfort of their home and bid!
  2. Bid from anywhere! 
  3. Unlike a live auction, there are bids already placed before auction day!
  4. Setting a date for the auction to end creates momentum and competitions for people to bid. Unlike a listing which could take several months!

Cons

  1. In this case the auctioneer does not chant out loud, but the time ticks down and flashes when someone bids. Still creating an exhilarating experience for bidders to keep placing bids!
  2. Tip – research auction companies and choose one who owns their bidding software and has multiple sold results of online land auctions over several years!

Sell by Listing

The biggest difference between auctions and listings is a for sale price instead of an auction date. Your real estate agent helps you understand offers submitted by buyers and markets the property for you.

Pros

  1. You set the price as a seller.
  2. Buyers who are investors can calculate return rate since the price is established. 

Cons

  1. Buyer’s will present offers with contingencies and terms which you either have to accept, counter-offer, or decline.
  2. Typically, listings are a longer process than auctions since there is no set date.
  3. You can easily over-price your farm or acreage and have to work down on price instead of up.
  4. Listings require a higher commission fee to cover paying both seller and buyer brokerages when compared to auctions.
  5. If there are multiple owners, all sellers will have to agree on the terms presented by buyer which can be challenging to achieve.
  6. Multiple open houses dates which are time consuming!

Sell by For Sale by Owner

Have land to sell? You can try selling on your own!

Pros

  1. You could get the job accomplished yourself as a seller. 
  2. Since you are the primary contact you will deal directly with potential buyers and receive all inquiries!

Cons

  1. Marketing/Advertising is all on your and cost money!
  2. You have to be comfortable accepting offers with contingencies and having conversations with potential buyers. 
  3. There is no sense of urgency for buyers to present an offer when compared to timed online auctions which have a time frame laid out. 
  4. If selling land with a house, you will need to have multiple open house dates. Visits from potential buyers can be very inconvenient.
  5. You will be responsible for making sure the closing process is moving correctly and on time.
  6. Selling land is complex, and sometimes paying an attorney for legal advice is necessary!

Private Direct Offer

I offer this method to sellers looking to keep their name private and not listed on their land auction or listing. This method is only advertised to select list of buyers who are required to accept the terms and conditions and place an offer within a few days.

Pros

  1. Completely private – you don’t have to display your name or who owns the farm.
  2. You will set your terms and conditions similar to an auction.
  3. Your property will only be marketed to a select few individuals and investors to make offers. 
  4. Typically, a fast process and can be used for lease back options.

Cons

  1. Since it is not advertised to the public, this creates a smaller buyer pool and may not achieve as high of a price like an auction would.
  2. Not as common when compared to auctions and listings. 
  3. Only select auctioneers and land agents provide this method.

Most landowners only sell land once in their life, and only get one shot at it to make it right. My advice – reach out to a professional who has sold multiple properties and can offer advice on what method best fits your land. If you have any questions or would like a free consultation, fill out this form and I will reach out to you!  

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