Things to Consider when Buying a Montana Ranch for Sale

Montana ranch for sale

Buying a Montana ranch for sale is a large investment and involves some risk. If you are a first-time ranch buyer, there are a number of unknowns that can affect the current and future value of a property. Venture West Ranches is here to help guide you through the buying process. With our knowledge and the knowledge of experts in specific areas, we can help you with any questions or concerns you may have about buying a Montana ranch. This article gives you specific things to look for when evaluating properties and their future potential.

Mineral rights

When looking at buying a Montana ranch, one thing to inquire about is whether the property has mineral rights. Most times they are not for sale but if they are, it can be a great investment and protects you. Mineral rights allow you to extract or produce any of the mineral lying under the surface of your property. If you are unable to purchase the mineral rights to the property you will be unable to extract any of the minerals found on the property such as oil, gas, gold, and silver. One way to identify possible mineral resources on a property is by looking at neighboring properties and their production. If all the surrounding properties are extracting oil, chances are that the property you are looking at has oil resources and you will be dealing with oil companies from a less than ideal position.

Water Rights

Water rights are a very complicated aspect of real estate. When looking at buying a Montana ranch, it is important to understand whether you are purchasing water rights and just how much. Due to the complexity of water rights, it is a good idea to get help from an expert. This is not just to understand what the water rights entail, but also to understand what needs to be done in the future in order to maintain procession of the water rights. There are several stories of water rights being sold for multiple times their initial purchase price of the land. The water rights can be the most valuable aspect of a property. Contact Venture West Ranches for additional assistance with water rights and what they entail and how you can use them for your benefit.

Water Access

Montana ranch for saleAnother aspect to consider in buying a Montana ranch is the access to nearby water for recreational use such as hunting and fishing. This can dramatically influence the value of a property.  Water access means that you have access to any body of water on or near your property. It is also important to know if any boundaries of the property are defined by bodies of water. For property boundaries that are defined by water, you only own the land that is above the historic high water mark. These are very important considerations in buying a Montana ranch.

You also need to understand if the water is accessible to the public. This can be positive or negative depending on the location and the nature of the publics activity. If you have exclusive access to the water, you have a very valuable asset. However, if the public has access to the water it could impact the quality or your enjoyment of the nearby water. Another issue in buying a Montana ranch is keeping people off your property. If you do share water access with the public this may be a problem. Keep that in mind when looking at properties that share access. These are all things to consider when looking at buying a Montana ranch. Water access can increase the value of a property and provide excellent recreational opportunities but it is vital to understand every aspect of having and sharing water access.

Carrying Capacity of Livestock

If you are looking at buying a cattle ranch in Montana or you have an interest in starting a herd, it is important to know the carrying capacity of the land. Carrying capacity depends on the size and quality of the grazing land. You want to make sure that you do not have too large of a herd for the land to prevent overgrazing. Having a correct number of cattle enables you to have a sustainable grazing management system. It is also important to know what past carrying capacities have been based upon. Were they based on years of heavy rain or years of drought? What should the herd sizes be for each type of moisture years? These are important questions to ask property owners when buying land for cattle production.

Conservation Easements

Another thing to understand when looking at a Montana ranch for sale is whether it is part of a conservation easement. Many conservation easements restrict the number of standing structures on a property. Conservation easements can also dictate what can and can’t be done on the property. It is important to understand all restrictions on the property before buying a Montana ranch so that you don’t run into complications in the future.  

Montana ranch for saleWildlife Resources

Another thing to look for when evaluating potential properties is its wildlife resources. Almost any Montana ranch for sale will have some form of wildlife. The key is to understand if you can capitalize on the wildlife resources on the property. Montana is separated into 7 hunting regions which are further separated into districts. Each district has different regulations on who can hunt what types of animals. In some cases, out-of-state hunters are unable to hunt in certain districts. In other districts, the only way you can harvest an animal is if you draw a special tag. This is important to consider when purchasing a Montana ranch for sale because you want to be able to hunt on your property. You don’t want to have a ranch with a great wildlife population and not be able to hunt it. 

 

CRP

Another factor to look at when looking at a Montana ranch for sale is whether part of the land is enrolled in a Conservation Reserve Program (CRP). Land enrolled in a CRP receives annual payments from the FSA in exchange for agreeing not to use the land. Contracts usually are between 10 and 15 years in length. The goal of the CRP is to increase water quality, prevent soil erosion, and increase wildlife habitat. Land enrolled in a CRP has restrictions that must be followed or the FSA may void your contract. You need to know if land enrolled in CRP by a previous owner will transfer to you after purchasing the property.  Understanding the length of the contract and its conditions are essential.

Neighbors

Many property buyers forget to inquire about their potential neighbors. Neighbors can add to the value of a property because they make living on the property more enjoyable. Start by asking the sellers of their opinions on their neighbors. The last thing you want is someone shooting at you over the fence or trespassing on your land. Having good neighbors and a healthy relationship with them can increase the enjoyment you get out of buying a Montana ranch.  

Montana ranch for sale

Canada Thistle

Noxious Weeds

Noxious weeds are a growing problem in Montana. They kill and displace native plant species which cause increased erosion and negatively impacts wildlife populations. When looking at a Montana ranch for sale, make sure you look for different species of noxious weeds. If the property has noxious weeds, you need to identify the species and how they can be eradicated. The Montana Department of Agriculture is a great starting point. The MDA also has a Noxious Weed Trust Fund Grant Program that will provide up to $75,000 to help solve noxious weed problems in Montana. Landowners can apply for a grant to assist in noxious weed prevention. This grant can help with your efforts to remove noxious weeds.

 

The buying process can be intimidating and stressful but it doesn’t have to be. Venture West Ranches is here to help answer any of your questions or concerns. Our goal is to help you find the ideal property and make the process as easy as possible. There are many elements to evaluate when looking at a Montana ranch for sale. To narrow your focus, use some of the topics discussed in this article to gain a better understanding of what you want in a property. You might also want to read Buying Montana Ranch, 13 Things to Ponder or the recently released 2017 Montana Ranches for Sale Real Estate Report. Contact Venture West Ranches with any further questions or concerns regarding the buying process of Montana ranches and land.

 

References

http://agr.mt.gov/Weeds

https://www.fsa.usda.gov/programs-and-services/conservation-programs/conservation-reserve-program/

 

About Buzz

Buzz Tatom is a Partner at Venture West Ranches. He moved to Montana 6 years ago and still owns the 5T ranch in Texas. He has a BBA from Texas Tech and an MBA from SMU. Buzz and his wife, Kathy are involved in a number of business ventures. He also enjoys being a part-time professor at MSU in the business school and mentoring students.

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