A growing part of the Stalcup Ag Service’s appraisal and consultation business has been centered around helping families decide how to divide the family farmland into separate ownership.
Here are three steps to help you divide your farm:
1. Get a Certified Appraisal
In order to understand the full market value of your farmland, you need an appraisal from a certified appraiser.
Our appraisals are full narrative reports utilizing all three approaches to value:
- Cost allocation
- Sales comparison
- Income capitalization
We find and analyze as many comparable sales as are available through our sales database and courthouse records. We personally inspect and analyze each property and utilize AgriData, an online digital mapping website, for soil information.
Often times, farmland has various types of co-ownerships where each individual owns an undivided interest in the farmland.
Partition appraisals are used to establish a division between multiple owners with individual owners receiving a specific piece of land. This is beneficial as each individual can sell, trade, or transfer ownership in a specific property rather than a percentage of interest in a property.
2. Equitably Divide the Land
Be sure to account for differences in soil quality, configuration, and terrain/topography. We provide a written proposal showing the proposed division to the owners. This most often is equal value between each owner but can be by certain parcels if one of the owners is willing to pay the difference or “boot money”.
3. Complete the Closing Process
We line up a surveyor if needed to get a legal description for the deed work. Most of the time a survey will be needed to show the division of ownership for preparation of the deeds to complete the division. We can recommend or assist you with hiring an attorney to help with deed preparation.
One of the driving reasons for the increase in the family division work is the current generation wants to provide clarity for future generations instead of seeing the farm get divided into smaller and smaller undivided interests.
Partner with Stalcup
If you or your family are looking for guidance with the division of your farmland, reach out to us. We’d love to walk you through the process and answer any questions you may have.
Related: Explore 3 Effective Strategies for Selling Farmland in Iowa
