The Benefits of Investing in Timberland Part 2
Purchasing timberland is one of the best and most underrated investment strategies. As we discussed last section, there are many benefits to purchasing timberland including property tax exemptions and having the open land to do the things you love to do. In this section, we will discuss how timber is valued in the market and how it can create a long-term steady cash flow for your property. If you are interested in land for sale in Polk County Florida, please contact a land expert today.
The Value of Timber
The fiscal return on timber greatly depends on a lot of circumstances relevant to your property; however, if properly managed, a timberland owner can easily make several $100,000 dollars in a few decades by simply owning the land and performing a few basic tasks when necessary. The value of timber is influenced by the following things:
- The local market is the main driving force pertaining to your timber value. When timber is located near other mills, the price is typically elevated.
- The type of timber your property possesses is clearly important. Along with the type of timber, how much timber and the quality of the material are also important factors.
- The harvesting strategy is another important factor. Some timberland owners elect to harvest most of their trees at the same time; whereas, others elect to do “third row cutting.” Regardless, the price can be affected by the size of the sale.
- The property can also be influenced by the amount the buyer is willing to invest. For example, easy access to transport the timber to the road and other variables can impact the amount the buyer is willing to pay for your timber.
- Certain areas may have environmental zoning requirements that limit the process and use of certain equipment. Depending on the laws in your community, this can impact the sale of the timber.
Easily Maintained Crops
Perhaps the greatest benefit of owning timberland is that it takes little maintenance to care for the crop. Along with periodically mowing around the timber, the only other task that needs to be performed every few years is controlled burning. Even if you rarely visit your property, investing a few thousand dollars each year can maintain the timberland. Once you harvest the timber, you will see a significant return on this small annual investment.
Because timber can be a project that lasts decades, it also can become part of a family legacy. Fathers can teach their children the basics of timber upkeep and this tradition can remain in a family for generations. Of course, during these years the land can be utilized for many other enjoyable activities as well as give the investor both a long-term stable return on their investment and also a location to enjoy with their family as well.