by George Looby, DVM
As has been stated many times in recent years, the services, facilities and support programs available to new, young and start up farmers has expanded remarkably, making career transitions into agriculture far smoother than they would have encountered not that many years ago. The mindset of those closely involved at the support level has done an almost complete turn around in the last decade to one that finds itself eager to provide assistance in a wide variety of ways to those in the start-up mode.
There has been a move away from turning every vacant parcel of land into yet another housing development or strip mall. A growing group of concerned landowners want to keep their land in agricultural production after they are no longer physically able to manage the acreage themselves.
Bringing together those who have land available for production and those who are searching for land to farm is often a difficult task because no good pipeline exists to make one party aware of the other’s needs and wants.
In an effort to overcome this disparity, at least three groups have joined forces to make this a less challenging task. The University of Vermont Extension Center for Sustainable Agriculture and the Vermont Land Trust (VLT) have developed a training program for Vermont Real Estate Professionals with funding provided by a grant secured by Land for Good.
Bob Bernstein, an individual with a background in community economic development and affordable housing, founded this organization in 2001 in Keene, NH. Land for Good made its mission land conservation and farm focused community economic development projects. In the years since its founding it has accomplished much in the area of farmland preservation with one major focus being that of bringing fledgling farmers in contact with those who have farmland available for sale.
In most instances where real estate transactions are taking place real estate agents become involved in the process and in the majority of such dealings their expertise makes the entire process easier for all parties concerned. In too many instances there are unforeseen roadblocks that may serve to make an otherwise straightforward transaction far more complicated, these can often be avoided with a good agent being involved. An unfortunate reality is that many agents have had very little or no experience in dealing with the realities of things agricultural. This is quite predictable given that the percentage of the total population with real time on-the-farm experience is less than 5 percent. The training that most real estate professionals get in formal classroom settings is usually concentrated on residential and commercial real estate with little or no time spent covering the unique aspects of farm purchase and sales. The same holds true as they begin their sales careers under the tutelage of a licensed real estate broker. In most real estate firms, farm sales make up a small percentage of the total yearly sales, making it difficult to justify any time spent in intensive preparation for such sales.
In those areas where farms sales occur at a more active rate it has become apparent that having one or more staff members with specialized training in agricultural real estate sales would have some real advantages. With this need realized Land for Good succeeded in obtaining a grant to fund the development of a training program for real estate agents in farm transactions.
In January 2015 Bob Waterman of UVM, Jon Ramsey of VLT and Mike Ghia, Field Agent for LFG in Vermont presented a program entitled Tools and Resources for Working with Farms with Commercial Agricultural Potential to a group of interested Vermont real estate professionals. Those in attendance were awarded continuing education credits towards their re-licensing requirements.
This class was designed to provide attendees with as much information as possible in a one day session that would prepare them for some of the unique characteristics of farms sales that set such sales apart from other real estate transactions. Subject matter included ways in which the agent might better reach the potential commercial farm buyer and the likely characteristics of that buyer. Other material included an introduction to legal and tax issues peculiar to farms, financing options available to commercial farmers and an introduction to conservation easements and issues that need to be considered when selling farms which have existing conservation easements.
It is the groups plan to present an additional program in the upper river valley this fall for those in that area who were unable to attend the meeting in Middlebury. Not long after the program will be presented in New Hampshire and further down the line the organizers will take the show on the road to other Northeast states.
For those who are actively pursuing the purchase of a farm and have enlisted the services of a real estate agent it is important to remember that that individual is working for the seller and everything that he/she does is in that persons interest, the bottom line is to get the best possible price for the seller no matter how cordial and accommodating that individual may be when talking with you. His/her income is based on his negotiated percentage of the selling price. Those who want a more level playing field may choose to enlist the services of a buyer broker who acts on the buyers behalf to insure that all points of the potential transaction are disclosed and carefully explained. That person is responsible for scouring the countryside to explore all properties that meet the buyers needs. In all instances a buyer should enlist the services of an attorney well versed in real estate law with particular emphasis on farm acquisitions.
It is hoped that the news of this program reaches all of those in real estate who have a strong interest in this area of their business activities to better prepare them for its many unique facets.