The American West is home to incredible landscapes, rolling grasslands, and diverse climates and ecosystems. As such, you might be wondering, where is the best place to buy a ranch in the US?
The answer to this question depends on several factors such as how you intend to use the property, as well as your budget. Just like all real estate searches, finding the perfect location starts with an understanding of your wants and needs, and finding the best ranch that corresponds to those parameters.
What to Know Before Buying a Ranch
There are several things you need to consider before you buy a ranch when you are figuring out the best location, as it is quite different than buying any other form of real property. This is particularly true in the West, where there are many complex issues and particularities of real property laws and state regulations that need to be considered. Some of the top things to know:
- Your Operational Plans. Will you be an owner-operator or an absentee owner? What will you grow? Will you have livestock? Many independent cattle ranches in the intermountain West are either cow-calf or yearling operations. If you are looking to operate a cattle ranch, you will need to determine the carrying capacity, as well as if you are a summer grazing operation or a year-round operation.
- The Ecology. The ecological conditions of the ranch are also important considerations. Private ranches represent some of the most biologically diverse landscapes in the West and impact wildlife habitat. Taking care of the land is significant to the underlying value of the land for generations to come and this must be balanced with operational considerations.
- Water Resources. Water is critical in a viable operation. Not only are water rights for irrigation and sustaining bucolic riparian areas key, but wells, tanks, and underground piping for livestock watering may need to be in place.
- Infrastructure and Working Facilities. From fencing to corrals and chutes, understanding your basic and working infrastructure needs is key. If you have hundreds of miles of fencing in poor condition and it all needs to be replaced, this could cost a new rancher millions of dollars.
- Public Land Leases. Perhaps one of the most unique attributes of the West is the abundance of public lands. In ranching, the use of public land grazing permits can be crucial in making the operation pencil. Grazing permits are essentially leases with the National Forest Service (NFS), Bureau of Land Management (BLM), or other federal land agencies and also include state land boards in the various western states.
For more information on what to know before making this investment, take a look at the Financial Times’ Beginners Guide to Buying a US Ranch.
Is buying a ranch a good investment?
Are ranches profitable? We get this question a lot. Working the land and running a livestock business can definitely produce income. However, profitability depends on a number of factors such as your operations plan and strategy, market conditions, your financial health, among several other considerations.
How much money do you need to buy a ranch?
To financially plan for your perfect ranch, we suggest checking out our article, “How much does a ranch cost?“
What is the best state for ranching?
Many states have their advantages and disadvantages. Here’s some food for thought on some of the states we work in regularly:
Why Colorado?
- Closer to resort towns and larger cities and amenities
- Higher demand means a higher price-per-acre than many surrounding states
- More incentives for donating a conservation easement
- Diverse topography
Why Wyoming?
- Lower price-per-acre
- Business-friendly tax climate
- Climate is more volatile than some states
- Least densely populated state in the country
Why Utah?
- Less private land than any other state with five National Parks
- Land values tend to be higher because of private land scarcity, but still lower than Colorado
- Diverse landscapes
- Flat tax rates can be beneficial
Why Montana?
- Larger acreage ranches
- High growth communities providing an increased level of amenities
- Vast public lands and unparalleled access to unpressured recreational resources
- More potential upside for value appreciation over time
Why New Mexico?
- Larger ranches and bigger acreage footprints (due to historic settlement and Spanish land grants).
- Less Crowded (at 2.7 million, New Mexico is half the population of neighboring Colorado)
- Lower price-per-acre
- Emerging markets with high appreciation potential (Los Alamos, Questa, Chama)
- Excellent hunting and generous conservation incentives
Questions to ask when buying a ranch
Take a look at the 4 essential questions you should be asking yourself when buying a ranch for our top list of questions.
Ultimately choosing the best ranch for your needs will have an impact on income generation and appreciation for years to come. Please contact us today if we can answer any questions you may have in finding the best place to buy a ranch.