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There are many more detailed considerations in purchasing an acreage, ranch or farm as opposed to an urban home. Whether you want to work the land or just enjoy life in the great outdoors, buying rural property can be a great life investment. Even expert property investors make mistakes with their first rural property investment, precisely because they are unaware of the unique risks of purchasing a ranch property or rural acreage.  Our experienced Realtors will want to discuss your goals and expectations, your finances and timeline, current market conditions and the availability of properties that meet your expectations.

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Considerations when buying a rural property:

Ensure that you obtain an accurate property survey and finding an agent that is familiar with buying rural property in that area as a first step. REALTORS® will set up the closing and help both the buyer and the seller meet the demands of the written contract. Rural Real estate closings can be very complex. OurR EALTORS® will be able to explain a lot of the procedures and work out who will be responsible for certain expenses of the transaction. This will include closing fees, document preparation, accruing real estate tax liabilities and recording fees.

Is it a dug or bored well, is the water potable and will the well provide sufficient volume for your family’s and livestock needs? Are there any water rights to springs, surface streams, lake or rivers on or adjacent to the property?

Rural Acreages have septic systems or lagoons consider having the septic system or waste water lagoon inspected by a qualified septic inspector. A visit to the local municipal office may provide you with the original application, plan and use permit.

If there’s a wood stove or wood-burning fireplace, a satisfactory WETT inspection report should be obtained,  it will confirm the safeness and correct installation of the wood-burning unit. Your insurance company may insist on a copy before they agree to issue a policy. And if you can’t get insurance, your mortgage company may not advance the closing funds.  To learn more on this subject, click WETT.

When you buy rural, it’s important to know that there are no hazardous conditions or substances existing on the land.  A careful visual property inspection, along with a seller warrant clause, can allay any fears. But if you suspect a buried oil tank, for example, or a garbage dump or there was an auto repair shop out back, or the abutting property has a junkyard full of old rusting cars, you may want to include a condition to protect yourself. Or better yet, investigate prior to even submitting an offer. Buried oil tanks, which have been known to contaminate the surrounding land and ground water, should be removed by a qualified licensed technician.

Are special requirements when it comes to maintaining livestock and animals. Limits on numbers related to acreage, manure storage requirements and minimum setback distances for outbuildings from your and the neighbouring homes must all be considered.

Is property access via public or private road or across an adjacent property by right-of-way? Are there wetlands on or near the property? Is there flood potential? Does the zoning suit your needs? What’s the potential for future development on abutting properties?

It is extremely important that everybody, realtor, buyer, seller and anyone else involved in the sale, understands in writing what is included in the transaction. A detailed list of anything you feel you are buying needs to be a part of the contract. The list may include:

  • Gates
  • Livestock panels
  • Portable sheds
  • Fence posts
  • Feeders
  • Treatment or removal of any existing farm or hunting leases
  • Any miscellaneous equipment
  • Anything that can be moved

If you are getting an inspection, outbuilding and detached garages may cost extra. If you can find an inspector that specializes in farms, great! If not, you might even consider hiring someone else to look at the outbuildings or equipment, separate from the house.

Property Boundaries Unless you want to have a survey completed, no one will ensure the number of acres you are buying; they will ensure a legal description. Normally the description will be written in either a rectangular survey or meets and bounds method. It is usually a good idea to go to the assessor’s office and have them pull the “card” for the property you are looking to buy and see how many acres are being taxed. This doesn’t mean their figure is right, but it should compare fairly close to what you have been told by the owner or realtor. If there is a big discrepancy, you will want to complete some additional investigation. Also, if you are obtaining a loan on the property you are buying, the lender will normally complete an appraisal as well as examine the title policy to ensure they have the right amount of security for their loan and to ensure they have a legal claim based upon the deed of trust filing.

Zoning should be investigated before you buy rural property. You will need to go to, or call, the land title office where the property is located. They will be able to tell you if the county has been zoned and, if so, what the zoning requirements include. If you are going through a realtor, they should also be able to help you.

Will the Harmonized Sales Tax (HST) be payable on the purchase price? When buying Canadian rural property, a ruling from Canada Revenue Agency (CRA) may be needed. Normally, when buying large acreage, the house and small plot of land immediately surrounding the house will be free of this unpopular tax, but the larger acreage may not be. Thus, your purchase could be subject to much higher closing costs than anticipated.

Title Insurance  When you buy a car, the first thing you do is buy insurance before you leave the lot. Why? To protect you case of an accident. Title insurance does the same thing only in terms of ownership. It ensures your ownership of the farm in the amount that you paid for it as long as all of the items listed as exceptions are corrected. This may include transferring ownership by legal deed, or the seller having a deed of trust removed. The closing agent will review any items that need to be discussed at closing. Normally, you will receive a copy of the title insurance commitment days before the closing. If you have any questions, ask an attorney to review the policy. Purchasing a title policy is the most secure way to buy property today. Title insurance will also warn you if the property has been the site of an identified hazardous waste dump site.

Costs of Ownership  After normal operating costs, the investments needed after the purchase will depend largely on the type of property you purchase and what your reasons were for buying. The more involved you are with your property, the more additional investments you may need to make. These items may include farm equipment, ATV or a storage shed or barns. Or, it may include livestock purchases for pasture. Even recreational property usually ends up with a small tractor and a mower, a four-wheeler and trailer. And these are just the larger ticket items. The cheapest part of owning rural property is the initial purchase.

Useful Links for Buyers:

BC Livestock Market Report

Contact a Ranches Only Realtor in your area