6 Common Real Estate Farming Mistakes That Can Be Easily Avoided
Real estate farming is one of the most rewarding businesses. The business becomes even better if you get an excellent geographic farm and solicit the majority of the neighborhood for the business, which would be a perfect marketing strategy. Even though, as much as real estate farming is a rewarding long-term investment, it can turn out to be a nightmare.
It becomes a challenge if you cannot meet the demands of the investment. For instance, it requires expertise, time, hard work, a proper budget, and commitment. In addition, you have to employ good marketing strategies to make your business a success. A good real estate farming flyer can be an excellent lead to desirable returns. Read more on some mistakes you need to avoid in real estate farming here.
Choosing an Oversaturated Neighborhood
It is not easy to tell the right or wrong farm at a glance. Probably you chose the bad neighborhood. You may start investing and realize that your farm is not productive even after a year or so, or it is not yielding as much profit as the effort you are putting into the farm. It is essential to understand that the size of the farm matters. You do not expect a small farm in a congested community to yield a lot of profit.
It would help focus on a neighborhood where you enjoy working and are comfortable sending out your real estate farming flyer to the residents. In reality, you will not expect a real estate farm to start yielding results in a few months. Also, it can be hectic to manage through the noise of a crowded neighborhood of all farmers. Therefore, settle in a less saturated area to live comfortably and be patient with your farming.
So, to counter that challenge, choose an area that is not all crowded and if you must settle where someone else is farming, have a strategy to beat the competition.
Not Mailing Frequently
Your farm’s success depends on your marketing tactics. Sending out one real estate farming flyer and waiting for a long time before mailing again will not yield you positive results. Please pay attention to your interaction with the outside world, your target market.
If you aim to reach a broader market, you have to mail frequently and employ other marketing techniques like advertising in the community newsletter. That way, you will be able to increase your sales.
Giving Out Farm Cottages to Farmworkers
You may lose the security of your farm cottage tenure by offering the cottage to your worker and their family unless you follow proper procedures. It may seem normal until the employment comes to a blunt end, or you need to give the cottage to another occupier.
Some farm employers tend to overlook that an employee benefiting from your accommodation may have a right to continue living in that house even after retirement. Sometimes, the employee’s spouse has an equal right to inherit the cottage. In addition, it may be a challenge to use the cottage as security to secure a loan since the tenure security has a significant impact on the value. Subsequently, you end up losing the farm cottage completely.
You can avoid this mistake by following the proper procedure from the start. However, if you have made this mistake, you can still correct it by seeking professional guidance.
Accidental Business Tenancies
If you have a spare shed on your farm that you are not using, renting it out to a friend or a local business sounds great. But there is a danger you may grant a tenancy by mistake. Most such agreements are informal and attractive ways to increase your farm’s income. However, not all real estate farmers will like that, as sometimes it may mean that the occupier has a permanent right to tenancy.
The major problem with these arrangements is the danger of losing the tenure security to the tenant under the landlord and tenant Act unless you follow the proper steps. It can also be challenging to remove the tenant if you want the building back. In addition, the tenancy will reduce the value of the property in case you want to use it against a loan. Losing agricultural space is another danger of tenancy that many farmers overlook.
To avoid this mistake, the farmer and the tenant must agree that the tenant has no tenure security for the rented space. If you are a real estate farmer, please ensure you complete this agreement before starting the tenancy to be on the safer side.
Get the Most from Your Real Estate Farm
As you embark on real estate farming, you expect to get the best returns from your input. However, that can only be possible if you put adequate effort into the farm. If you can avoid these mistakes and do more research, you will achieve desirable results.
