The best market analysis for your rural property is the most accurate analysis. A "favorable" market analysis that is not prepared by an educated, ethical expert in rural land appraisal may not prove so favorable for your investment in the long run.   Verifiable documentation of your rural property's market value, through expertly collected data is an invaluable investment tool. Where subjective opinions will not stand the test of scrutiny by investors, courts, or the government, an expert rural land appraisal will. The benefits of such an appraisal, with credible market analysis, are wide and varied. The following Five Truths of Accurate Market Analysis should be reviewed carefully before you make important decisions regarding your rural property.
 
Truth #1 - An Appraisal Is Not an Appraisal Is Not An Appraisal
If you are selling a home in an urban market, an educated real estate agent can find plenty of homes for a comparison basis to price and market your dwelling. Even the unique qualities of an upscale, custom-built personal paradise home can be appraised and compared to another high end, custom-built property with equally personal attributes of similar value. But when it comes to rural land, the variation is vast among properties, and intrinsic aspects such as soil (preestablished by the earth itself) must be carefully considered in attributing value. As such, an appraisal is not an appraisal is not an appraisal. Each rural property requires meticulous examination of elements that only a highly-trained and experienced eye can begin to assess accurately.
 
Truth #2 - Rural Property Is Not Rural Property Is Not Rural Property
Perhaps you think every farm has land, water, and a building or two. How different can any two farms be, especially if they are in the same state?   According to Steve Runyan, Accredited Rural Appraiser in California, "The appraisal of just water sources alone requires in-depth data collection as to types of sources, restrictions, boundaries, and pertinent regulation. This is just one aspect of a comprehensive appraisal picture that must also include data on crops, soil, building maintenance, improvements, and daily operations efficiency, each with several subsets of important data. The omission of one important set of data can skew the market analysis considerably."
 
Truth #3 - An Appraiser Is Not an Appraiser Is Not an Appraiser
It seems the adjective rural changes everything. This is also true when it comes to professionals in the world of appraisal. In this case, "rural" is not just a word to be inserted in front of the title of any appraiser. Brian Stockman, Executive Vice-President of American Society of Farm Managers and Rural Appraisers, verifies that. "The designation of Accredited Rural Appraiser is only given to those professional experts who have met the most rigorous standards of education, ethics, and experience, including very specific curriculum, supervised experience in required settings, and adherence to a code of ethics monitored by an ethics committee."
 
To give you an idea as to the unique expertise represented by a typical ASFMRA Accredited Rural Appraiser, (ARA), most experts have either a real estate degree or a college degree, or equivalent of agricultural land management experience. A minimum of five years of verifiable appraisal experience under a qualified expert is also required, as well as three hundred eighty five hours of additional education. Of those hours, two hundred thirty are specific, upper level ASFMRA courses. In addition, a full demonstration appraisal report must be submitted before taking the two-day exam for accreditation. Clearly, working with an ASFMRA Accredited Rural Appraiser is a smart decision for your investment!
 
Truth #4 - Motivation is Everything
Sometimes the best way to predict an outcome of effort is to measure it against the original goal or motivation. This is true of both the owner and the appraiser. If your goal is getting the best market analysis on your rural property, you are motivated to stay away from the cheaper, faster alternatives. If your motivation, on the other hand, is to get it done quickly, regardless of quality, you will fall prey to any so-called expert with the word "appraiser" on a business card. 
 
If a non-accredited appraiser is going after your business, she or he has a goal in mind, as well. Is that professional's goal also to get the job done as quickly as possible, to reach a commission target before the end of the month, to qualify for a bonus, to secure a job for a staff member or to sway a judge in a property distribution decision? If so, none of these motivations serves your best interest or that of your rural property. However, only you will reap the negative consequences of a sloppy or unscrupulous appraisal by a non-accredited rural appraiser. The consequences can affect your estate planning, taxes, financing options, credit rating, and lifestyle. On the other hand, an ASFMRA Accredited Rural Appraiser is motivated to conduct the most accurate appraisal for you because accreditation, membership, and reputation depend upon it. 
 
Truth #5 - Reaping What You Sow Is Not Just a Proverb
You have many choices as you contemplate what to do with your rural land. It may be a crucial part of your future lifestyle, or a casual investment you delegate to qualified farm operators. It may be an heirloom you preserve for your family's legacy, or become a vital income source for you. One thing is sure, you cannot improve or use something optimally that does not have an accurately measured value. Unless you know the accurate value, you don't know what you would pay to keep it or exchange for it. If it has no "real" value to you, then you can give it away for free. 
 
Assuming giving it away is not your first option, then let your first sowing into your property be the investment of an accurate appraisal. This will provide the foundation you need for a "high yield" on your rural property goals, whatever they are. When a "real" decision is required, it follows that a "real" appraisal prepared by a qualified rural professional provides the basis for decisions which affect family interests for generations to come.

A good reputation, it is said, is better than gold. When it comes to agricultural land investment, the two can be one in the same. Maintaining and increasing the value of a rural property does not require a special formula so much as qualified help to focus on a few key principles. Matt Rekeweg, AFM, Vice President of Halderman Farm Management Service, Inc., states, "A property which increases in value has been operated according to not-so-common sense priorities, or building blocks, of healthy farm maintenance."

Priority #1 - Building Your Farm's Reputation
Even in an age of sophisticated, worldwide communication and data sharing, opinion still carries "heavyweight" influence. Should your land be marketed, you need a solid reputation that will pass the scrutiny of local farmers and landowners. Their consensus on your property's reputation will ultimately factor into the perceived income potential or capital value of your agricultural investment. Property value is, after all, dictated by a given market's expectation of production or potential, and is established by those willing to buy it. Potential buyers want to come to the table with some level of knowledge about your agricultural land. A good source of information is local farmers with a firsthand view of your property, especially if the potential investor lives in another state or is not from a farming background.

Priority #2 - Hire an Accredited Expert
A qualified rural land expert, in this case an Accredited Farm Manager (AFM), makes it his or her job to stay current on the general trends of farms being sold or bought in the surrounding area. As a landowner, you need the eyes and ears of a professional who is educated and experienced in maintaining the quality - and, therefore, the reputation - of your farm among the surrounding agricultural community. It is the diligence and expert understanding of an AFM which will propel your agricultural land toward its potential in soil fertility, land use, crop or livestock production, appropriate improvements, to name a few. A good reputation is a natural byproduct of an expertly run farm in the end. Enlisting the help of an AFM will ultimately increase the value of your agricultural land investment.

Priority #3 - Partner With Top Quality Tenants
Land tenants have a great influence on your land. Choosing them well requires an understanding of what constitutes a productive partnership, specifically in an agricultural context. In the farming business, a tenant is more than a renter and should be selected with expert care. This decision alone affects the value of your land enormously, given the ripple effect of decisions and care rendered by a tenant. A top quality tenant, working under the guidance of an Accredited Farm Manager, will make timely decisions as to state-of-the-art farming practices in areas such as fertilization, drainage, equipment, and site-specific cropping systems. The tenant's decisions affect crop yield, loss minimization, timely farm operation, and the maximization of all your agricultural land improvements.

Priority #4 - Soil Fertility is Crucial
One of the greatest singular factors of ultimate land value is the condition of its soil. Soil health affects productivity for generations, and years of neglect cannot be remedied or masked for the sake of quick sale. Your rural property must be expertly cared for or the next owner will adjust a purchase price to reflect what he or she must do to return the soil to its optimum state. Ideally, your land has been nourished and utilized under the qualified eyes of professionals who understand the priorities and critical cycles of testing, fertility management, and soil science in its many and varied categories.

Priority #5 - Appropriate Capital Improvements
Investments to maintain and increase the value of your rural property should be measured by their true contribution to your potential income. Drainage tile, grain storage, and erosion control, for example, all represent improvements that could pay off well in the long term. Still, the only way to be certain is to expertly measure the incremental return on these investments. Only then can you predict whether or not they will pay for themselves through new income streams.

Additionally, the benefits of some capital improvements - or even the improvements themselves (e.g. subsurface drainage systems) - may not be visibly obvious. In order for potential investors to perceive and accept the value of these improvements, objective documentation, in written form, is crucial. A professional Accredited Farm Manager makes acquiring and maintaining this proof (e.g. tile installation maps, elevator scale tickets, construction plans, etc.) a priority.

Priority #6 Curb Appeal Still Matters
The curb is decidedly larger, but the pride of ownership principle rings true, no matter the size of the property. The appeal of a modern, accessible, and functional property still stands as a keystone of property value. Accessible roads, well maintained fixed structures, environmental stewardship, and clean, well-kept grounds go a long way in expressing value. All the data in the world will be secondary in the eyes of an investor if the property is obviously not valued by the owners or tenants.

Priority #7 Keep it "Clean"
Keeping up with current regulation of environmental cleanliness is vital to maintaining and improving your farm's value. It is up to you to thoroughly assess your rural property's compliance to remove the fear of any surprises. Coming across an old hole filled with trash or a contaminated well, for example, could stall property negotiations unexpectedly. You can prevent such problems or find workable solutions with expert help.

There is no need to take on these many aspects of land stewardship on your own. Any singular expert cannot offer you the network knowledge and strength of assistance available to you through the American Society of Farm Managers & Rural Appraisers. Call your local expert or visit www.asfmra.org today.

News of your inherited property will invite many opinions and advice.  After a while, too many suggestions may persuade you that ethical, objective, and professional assistance will be critical to your success as a property owner.  You can spend months figuring out which advice is truly expert, or spend a few minutes reading about the members of the American Society of Farm Managers and Rural Appraisers (ASFMRA), who offer the highest standard of farm management, rural appraisal, appraisal review and consulting available to you in fifty states and Canada.

ASFMR Who?

ASFMRA, headquartered in Denver, Colorado, has 2,200 professional members whose services include professional farm and ranch management, property valuations, and rural property consulting services.  While you may not currently know who to ask for what, it is vital that you talk to educated, accredited professionals. 

"Agriculture is what we do every day of the year," says ASFMRA Accredited Farm Manager Ray Brownfield, from Illinois.  According to Brownfield, "We have the most up-to-date information on the ever-changing factors of farm management.  In all categories of rural property management, ASFMRA literally sets the standard."

In addition to the indisputable knowledge and experience of individually accredited experts is the benefit of their expansive network nationwide.  This invaluable sharing of insights among the membership translates to invaluable information for forecasting future business and farming cycles.

What Does that Mean to Me?

ASFMRA members must uphold the highest, regulated standards in their practices, after completing a rigorous curriculum of accredited courses to achieve designations as:

• Accredited Farm Manager (AFM) 


• Accredited Rural Appraiser (ARA)


• Accredited Agricultural Consultant (AAC)


• Accredited Real Property Review Appraiser (RPRA)

All ASFMRA Experts are bound by strict adherence to a code of ethics enforced by committees governing their standards, education, and accreditation.  ASFMRA Experts represent years of experience exclusively in rural agriculture, and provide ongoing accountability in their oral and documented reports.  ASFMRA Experts provide geographical expertise, as well, offering vast knowledge about your farm and its unique climate, soil, and location.  This protects you as landowner, and equips you to make sound decisions about your new property

Which ASFMRA Expert Do I Need?

The following are SAMPLES of the expansive services offered by ASFMRA experts. 



ASFMRA Accredited Farm Managers (AFM) are educated to:

• Inspect property to determine optimum land use


• Identify all existing water sources


• Assess building conditions


• Examine irrigation systems


• Study soil types for intended use and conservation practices


• Observe suspected EPA violations


• Analyze carrying capacity of range land for livestock


• Report on labor availability for farm operation

The AFM must help determine clear objectives and assess risk-taking ability, while educating the owner on critical cycles of timely farm management practices. The current farmer's management priorities and maximization of all existing resources are evaluated, and the AFM objectively reports how well the land is being cared for and "who's minding the farm," so to speak, making recommendations for improved operation. 

Accredited Agricultural Consultants and Accredited Farm Managers are educated to:

• Provide a full business and operating plan


• Project income and expenses


• Recommend type of lease, if rented or operated by another party


• Analyze and recommend specific solutions to unique issues


• Coordinate with fish and game services on wildlife management programs


• Align with Natural Resources Conservation Services


• Contact U.S. Forestry Service regarding timber market options


• Advise as to a hunting lease to enhance a recreational property


• Offer many and varied recommendations regarding optimum land use

ASFMRA Accredited Rural Appraisers are educated to:

• Collect objective data as to the value and potential use of the property


• Report on water access and/or restriction


• Assess asset value and income stream


• Measure current land stewardship, building maintenance, conservation, and fertility


• Present information on commodity prices


• Report depreciation, dividend income, insurance, land rent, and interest

Completing the roster of ASFMRA expert services is the Accredited Real Property Review Appraiser (RPRA).  This designated professional is called upon to provide impartial and independent assessment of the quality and compliance of another appraiser's work.  The RPRA, through expert analysis in the areas of USPAP Standards, IRS, and other government regulation, reports as to the thorough compliance of any prior appraisal of the property, as well as the reasonableness of said appraisal and valuation.

The RPRA's role can be quite expansive, as their expertise includes education and experience in both appraisal and appraisal review, enabling them to provide a basis for the differences in valuation disputes, as well as conclude their own independent values.  They also have the experience and expertise to assist in the writing of appraisal requirements to meet the needs of the property owner.

ASFMRA Accredited Real Property Review Appraisers are needed when:

• Real property is being purchased, sold, or traded


• Real estate planning is being conducted


• Real estate taxes are increasing


• Land could be placed under a conservation easement with tax credit


• Divorce proceedings have rendered two conflicting values


• A partnership or entity is being divided


• Condemnation action is taken against a property


• An owner does not know how to select the appropriate appraiser