When it comes to many aspects of farm ownership, having a good idea of what the farm is worth serves as the basis from which many important decisions are made. Estate planning, dividing land among children, determining fair rental fees or lease terms, and tax or legal issues all depend on an accurate farmland appraisal. Especially in the last several years, which have seen burgeoning farmland values, it is more necessary than ever to have an accurate assessment of land value.
Since knowing the value of the farm and land is such an important part of managing it, it is to the benefit of all involved to seek an expert appraiser to aid in determining its value. Land appraisers are rigorously trained and are licensed or certified in all aspects of property appraisal, and can help walk you through the steps in determining the value of your farm. “The role of the appraiser is to provide objective, impartial, and unbiased opinions about the value of real property—providing assistance to those who own, manage, sell, invest in, and/or lend money on the security of real estate” (Appraisal Institute, www.appraisalinstitute.org.). They do this by putting together various aspects of the property—its physical characteristics, size, uses, and location—and develop a value based upon those specific characteristics.
As with any professional, experience is key. Experienced appraisers can help determine the most accurate value of a property, which is of vital importance. For instance, the failure to accurately price the property is cited as the number one mistake that is made when selling a farm. Failure to accurately assess the value of the farm and surrounding farmland results in less interest from potential buyers, and the maximum value attainable from the farm may be missed.
Another mistake that is frequently made is to determine the value of a property based on a biased appraisal—such as one from a favored lender who sets the appraisal value higher based on the desire to lend money based on that higher value. As a result, the market value of your farm is inaccurate. The best way to determine the value of a farm property is to seek the unbiased opinion of a professional appraiser.
When looking for a qualified appraiser, check that they meet at least the minimum state requirements for property appraisal. Licensed appraisers are better, while certified appraisers have attained the highest level of educational requirements. Both licensed and certified appraisers must pass a rigorous examination that is administered by the state’s appraisal board.
Experts and those who have learned the hard way agree: Don’t miss out on the knowledge that an experienced farm appraiser can offer. Decisions about your farm are among the most important you will make.
UFARM offers appraisal services from experienced, licensed and certified appraisers. They possess years of practical, local land market expertise and combine it with the latest appraisal technology in order for you to gain a clear and accurate value of your land. Contact UFARM for your appraisal needs.