What do you guys think of reral properties in Tasmania. There are blocks of properties (60 acres or more) one can by costing $130-140K. Is there any potential. What about leasing to a forestry company or doing a joint venture plantaion? How to go about it? Does any body have an idea what could be approx rental per year for one of such 60 acre blocks 40 minutes from a major town centre if I lease it out to a forestry company? Any feed back appreciated.
Thanks.
SharifHi again!
I have done some research. One can lease land out to FEA at a rate of $350/hector/year for 15 -20 years lease. Do any one of you have any idea what has been the trend of growth in price of these kinds of Tasmanian rural properties?
SharifHi Sharif
I don't know much about Tassie but I have seen large areas of Western Vic near where i live go into trees in recent times . A lot of it has gone in is basically macquarie bank owned by subsidiary companies . They sell the units off to willing investors and make a killing in the process .
I own two dairy farms and have never invested in anything specifically around forestry . A 60 acre block could be a good investment . I once doubled my capital on a 55 acre block about 20 years ago . It all depends on you really…..
Shawn
Thanks Shawn. Hw long did it take to double your capital on 55 acre blck?
Sharif
Sharif , it took about a year , but …. we were coming out of the recession that we had to have . This was 1991 . Back when the earth was cooling !
I have friends and colleague's who have bought lots of 200 -300 acres a few years back and just leased them to farmers on a blog standard 3 by 3 sort of lease . In some of these cases the leasees have substantially improved these acreages with tracking , dams , fencing , troughs etc and now the owners are sitting pretty . Most dairy or grazing land in my area has doubled or more in the last few years . They aren't making any more of it .
Check out Top Croppers comments over on Somersoft…..he comments on this sort of stuff all the time..
Shawn
Hi Sharif,
I would be intrigued to confirm that you could buy anything at these prices that would interest FEA to lease at the rates mentioned, without substantial adjustments for the offsets required via management plans for gullies and watercourses etc. In addition, Tassie is quite expensive by mainland standards today, so any land at $2000 per acre is highly likely to be entirely unsuitable in so far as the plantation company's needs are: eg too rocky, low rainfall location, too much waste/offset areas etc. The land they now hold freehold from the past few years of activity (many thanks to the gullible city taxpayers (who've funded all this) who only hold the title to the "crop" (which has a very dubious future value) is of a quality that it would fetch $5 to $6k per acre today. Point being: $2k per acre land is very inferior stuff, and probably not suited to them in any meaningful way. Be very Careful!!
Wilrose
Thanks for your advice Wilrose.
Sharif
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