10 THINGS TO KNOW ABOUT YOUR DREAM RANCH -- BEFORE YOUR BUY IT!

By Craig Bowen, Plateau Business Development Coordinator

The decision to purchase your very own piece of Texas can be one of the most exciting times in your life, and also one of the most daunting. A real estate investment is the most significant purchase ever made for most people, but often the decision is made with too many unanswered questions. What is the land really worth? How do I know if it will fit my goals? Will it appreciate in value, or should I not rely on it as an investment? Can I really manage a property of this size, type, location, etc.? These are all questions that need to be asked (and answered) before you purchase a property. While current landowners also need to be diligent in finding these answers about their existing assets, for now, we'll discuss the top 10 things rural real estate experts should tell you to keep in mind before you sign a contract.

1) Location, Location, Location! - This old real estate mantra is true, but do not make the mistake of only considering how close the property is to where you live, work, or play. While a country getaway may be your primary objective, being close to a town of some size may be of some importance in case you require medical attention, additional supplies, or a contractor to complete a job on the ranch (take heart, though, most Texas properties are within 50 miles of an adequate settlement). Also, how close is the property to the nearest Interstate or train track? Road and train noise can travel up to two miles, so while it may be convenient to have Interstate frontage, consider how much noise pollution buffer you prefer.

2) Property Tax Valuation - Whether or not the property has a current Agricultural Valuation ("exemption") under the 1-d-1 section of the Texas Tax Code can be a deal-breaker. Taxes on a property valued under Fair Market appraisal can be as much as 5,000% higher than if that same property enjoyed an Ag or Wildlife Valuation. If the property does not have a current Ag or Wildlife Valuation, talk to the Central Appraisal District in that county to discuss your options for obtaining one, and how that will affect your purchase decision.

3) Mineral Rights - Are the mineral rights conveyed with the property? They often offer more immediate value and investment interest than the land itself! If the rights can be conveyed, make sure an attorney (not just your broker) checks all the documents related to the conveyance. If not, did the current owner agree to sign a surface waiver? If not, the property may still be explored, drilled or mined, or built on to access, store, or produce oil, gas, and other minerals after you purchase it even though the ownership has changed.

4) Habitat vs. Goals - Why are you buying this property? If it is to generate income, your operation will dictate the management of the property, and you probably already have some knowledge therein. However, if it is for recreational use, you must consider what secondary land uses fit your needs. Land, just like a house, yard, or building, must be managed for it to remain useful to its owner. Consider the property's eco-region, how much rainfall it gets annually (forget "average rainfall", and look at actual data from the last decade), and reflect on how you will manage the grass, brush, and water on the property so it remains in good condition. Will you graze or burn the property to keep the grasses in check? Will you need to conduct brush work every year to control juniper (cedar) or mesquite? Are there erosion control issues on the property that will have to be monitored? All these questions and more may fit well into an agriculture or wildlife management plan, which may also fit into your long-term property tax goals.

5) Size and Shape - How large are the properties you are considering buying? Usually this is dictated by goals and budget. If income generation (a hunting or cattle operation, eco-tourism ranch, winery, orchard, etc) is your ultimate goal, because bigger may be better for you, what can you afford? If recreation is the main goal, properties as small as 20 acres may be considered, especially if they have trails, large property neighbors, live water or ponds, etc. Also, consider properties with high surface area to perimeter ratios - properties relatively "square-shaped" will yield the least amount of fence to maintain, the least boundary shared with neighbors, and they are usually the easiest to manage in terms of habitat (water dispersion, brush control, etc.).

6) Access - No matter the quality of the property or how well it fits your goals, if you can't get to it or drive on it once you're there, it is useless. If the property falls in an area of high rainfall, or one that is prone to flooding regardless of the annual rainfall totals, are the roads conducive to wet-weather travel? If not, is there material on-site or nearby that can be used to remedy the situation? Also, don't forget to check the rural road conditions leading to and from the property. Is there a bridge that is too short or narrow to allow access with your RV, if applicable? Are those roads tolerable under normal conditions?

7) Flood Plains - Flood plains are low-lying areas which drain water from contiguous land. They generally occur adjacent to a major river or creek, and formally come in 10-, 25-, 50-, and 100-year varieties. Statistically, a 100-year flood plain will flood once every hundred years, or, more simply, there is a 1% chance each year enough rain will fall in one or a continuous series of events to inundate that particular flood plain. These areas are often the most highly productive areas in terms of grass, forb, and browse species in any given area, and are invaluable to the wildlife manager. However, many insurance companies often will not insure structures within even a 100-year flood plain. How close is the nearest 100-year floodplain, and how does it affect your prospective purchase(s)?

8) Neighbors - In his poem "Mending Wall," Robert Frost's character says "Good fences make good neighbors." Frost wanted a closer relationship with his stand-offish neighbor, and that is certainly the mindset you should have buying a property. Rural neighbors can help you watch your property when you're not around, give you advice on land management in the area, introduce you to valuable resources in the surrounding area, and become lifelong friends. Have you checked to see how they use their land, if their goals are similar to yours, and if you have similar interests otherwise? Though obviously not required, neighbors with comparable ambitions, personalities, and attitudes are definitely a bonus.

9) Endangered Species - There is no denying human use is affecting species all around us. Fragmentation and overpopulation in certain areas is diminishing habitat for a few once common species in Texas. If habitat exists on your prospective property for golden-cheeked warbler, black-capped vireo, red-cockaded woodpecker, Houston toad, certain salamanders, and others, it may affect your land use options -- but don't discount these properties, because Federal funds may be available to preserve this irreplaceable habitat. Check with a Plateau biologist about endangered species habitat or occurrence on your prospect tracts.

10) Past Use - What has the property historically been used for? The biggest concern here is old petroleum storage sites. If the area was high in petroleum usage before strict requirements were put in place, dilapidated storage containers may have leaked oil and chemicals into the ground, affecting plants, animals, and sub-surface water. Also, areas where saltwater from wells was pumped onto the ground instead of hauled off in trucks may still be barren. Both of these types of sites are usually evident upon casual inspection.

While for many landowners it is their heart and not their head that ultimately affects their property purchase decision, keeping in mind these considerations could save some heartache down the road.