If you were looking into ranch real estate in order to start your own cattle ranch, there are a few things you should know, especially if you have never done it before. Having farmland or a ranch very satisfying and rewarding work but work is the key word; it takes a lot of it. Here are some things that you should know before you start looking into different ranch real estate listings.
Animals
If you are already at the point where you were looking at ranch real estate then you should know that with no animals you have no ranch. The pitfall that many land buyers get into is that they tend to overestimate the capacity of the land they are looking up. Sellers frequently exaggerate the amount of animals that the land has carried previously. In order to make sure that the carrying capacity of the land will fit your needs you need to look up your local Natural Resources Conservation Service office and find out information about the potential of the land you’re looking at. Most counties should have that information available at the USDA office. You’ll need to know what type of soil it has, how much precipitation and the conditions for vegetation. This knowledge can help you get a more informed idea instead of having to rely on the seller’s word.
Time
One of the biggest misconceptions about running a ranch is that it will basically take care of itself. Although it make it easier, the ranch ranch is never going to get to a point where you don’t have to do anything at all. Cattle need a lot of care. Even a small ranch requires a lot of time to be devoted to it. Small ranches usually need up to about 20 hours of labor a week. If you were not committing your entire life to the ranch then you will need to hire someone that can. Obviously this will raise your overhead and lower the potential for profit. In order to avoid this you’ll need to plan carefully. Figure out the time that is needed for each animal in conjunction with ranch maintenance and make sure that you have the time necessary to commit to it.
Income
It’s a common mistake to overestimate what your annual production is going to be. Prices will change based on supply and demand and because of that the gross income will also very a lot. Generally speaking, a calf will be anywhere from $250-$400 but even those prices can change. Your best bet is to be fairly conservative when trying to project your gross income. Try talking with other ranch owners that are more experience and can give you a better idea of gross averages.
Expenses
The total cost of what you will pay depends on various factors. Of course you will have to pay for each breeding female and if you got a loan to buy the land. But even more so than that you will need to pay for regular maintenance, utilities and set aside money for taxes as well as paying any workers that you may have on the ranch. You should also consider emergency expenses such as backed up drains or flooding. You’ll need to develop a budget that you were able to stick to. Again, it’s a good idea to contact a professional that can help you figure out how to make a budget with variable income and expenses.
Ranch real estate may look enticing but don’t be deceived, there’s a lot of work involved and a lot of money and time that must be invested. Too many people start out on a ranch thinking that it’s going to be like living in a movie 24/7. Ranches in movies are just that- movies. They are real and they don’t show the real work that is done on them. If you have a lot of ranch hands then it might make the manual labor easier but it will diminish your potential for profits which defeats the purpose of owning a ranch. Once you get a little more experienced at the job, it will get easier or more habitual but at first it’s going to require 100% commitment from you and your family.
