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California
Gold Country
Real Estate Info
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Purchasing Legal Horse Properties What
to Know when you
Buy or Sell a Horse Property A. You must ask yourself "Why am I purchasing this property?" What is my budget? What do I value? What do I need? Will the location, schools, trails, property condition and/or shopping and local services meet my needs? Is the property worth what I am paying? Will I have to put too much time or money into it to get it into the condition I need -- based on the price being asked and my immediate needs? Q. How does this apply to the purchase of an equestrian property? A. Buyers are looking for horse/equestrian property for a variety of reasons. First priority is to get absolutely clear about what you want and why you want it. Is it for more pasture, more level land for an arena and barns? Closer to trails? It is for better drainage, richer pasture, more plentiful water, better riding conditions, more like-minded neighbors horse friendly? Or is it just for a larger home? Then, remember to number your reasons in the order of their importance. Sometimes it is just to scale down with less acreage to maintain. Q.
What are the main considerations sellers must take into account when
selling their A. Sellers should be advised of market conditions, interest rates, whether they want to carry paper and when is their target move date. Of course, they should obtain one or two market analysis from a Realtor of their property and/or a fee appraisal. It is also a good idea to ask for three properties in the greater area that the Realtors feel may be "competition" for their ranch so sellers can do a drive by and get a feel for what else is on the market with similar improvements and acreage. It is a very good idea for sellers to order, up front, a Structural Pest control Report (Termite Report) and a general Property Report to be knowledgeable about what the buyer may be willing to accept and what might be offered "as is." (Most often these inspections can be put into escrow and paid for at recordation of deed out of proceeds of property.) For instance, if the wood burning stove is just about worn out with missing fire bricks and worn out seals and is called on the Property Report, the buyer may well ask the seller for a new one (often priced at $2,000 and up) while if sellers realize a problem in advance, they can preparations to repair or replace with a good "used" one before home is sold--- or price their property featuring a new wood-burning store. The same goes for a roof or old plumbing or wiring that won't pass inspection. A septic inspection and a well report also provide good information to seller before home is sold but often buyers can order these during the inspection contingency if sellers do not anticipate any problems with either well production, potability of water or adequate flow of leach lines when they are "water tested." Sellers must remember, it is always harder to negotiate when the buyers pay for and order inspections after making an offer as buyers feel that if something is not in proper and normal working order then these items should have been disclosed up front. When buyers order and pay for inspections they often ask sellers to fix more items than sellers anticipate or want to fix. Q. What is the definition of hobby property? A.
It may be
just a property for a wanna-be breeder. He/She remembers when they had a
horse when they were younger and, now, close to retirement, thinks that
this is a good idea, providing a little write-off. A Hobby Farm may turn
into a Trophy Farm with just a few horses and lots of acreage
or a large home to show off while enjoying the good life. All are
legitimate reasons to purchase a horse property. A. This property could be used primarily for breeding, raising mares and foals, standing a stud, to teach riding lessons, board horses, training horses, or as a lay-up stable for race horses which need to recover from leg injuries. Q.
What are
some of the most common mistakes first-time buyers of equestrian A. Fail to get adequate inspections and fail to do a market analysis of property in the desired area. Fail to research the trails or other horse facilities and services where they will be moving. And, verifying the suitability of the zoning and restrictions for what they plan to do in the future or how they plan to currently use the property. |
California Horse Properties for Sale Q. From a legal perspective, what should buyers know before purchasing a horse or equestrian property of any kind (hobby or commercial)? <Sellers: please note also.> A. Be sure you can you obtain a legal title to the subject property, free of liens and other encumbrances that are not wanted. This of course can be properly addressed if you go through a Title Company and/or Law Firm and ask for a clear title, guaranteed free of liens. The preliminary title search will show all the recorded easements, such as road easements, electrical easements, water line easements, road assessments or other assessments that the buyer may be responsible for in the future. If buyers are buying into a subdivision with restrictions and rules and regulations, they should be read and understood. If the property has been a rental property, unrecorded liens may be something to look into. Be sure the renter knows of the sale in case there is some kind of long-term lease or unrecorded deed in hand that could hinder the sale at the last minute. PERMITS, ZONING, SETBACKS & VIOLATIONS: Also, if there have been illegal building additions or zoning violations (such as construction or electrical or plumbing additions not to code and/or without permits or steep driveways not paved when required) to the home (bathroom remodeling, family rooms, electrical additions, grading violations, ponds or swimming pools requiring permits, or there are illegal barns or outbuildings (such as electricity added to an Ag Barn <note: an Ag Barn in some counties can be permitted without a physical inspection by the county and are not suppose to have water or power to them>. Also, be sure the buildings meet the county setback lines and/or are grand fathered in. In some Counties barns have to be 50 feet from the property line; other counties only 30 feet. If you fail to check with the building department before purchase and you later go to the county to obtain a permit to remodel your home or make an addition to your barn, all the un-permitted items may have to be made conforming with their appropriate fees. That is why some owners remodel without a permit. The permit is not as important as the work down properly and meeting code requirements. A number of owners do not get permits to decrease the hassle and to supposedly save money on taxes. However, whenever you go to sell, the buyer may ask for an inspection or go to the County to research all the building/electrical permits pulled at this address and discover no records. All permits or no permits should be disclosed. A licensed Realtor should coach you and encourage you to make all inquires and inspections. WELL TEST: A buyer should also check the well report, if there is no public water, with the output of gallons per minute at the environmental department of the county in which they are buying. However, the buyer will probably want to get a current well report because water levels change and he/she will want to be sure the well is not drying up. A four-hour draw down by a local well company is suggested which costs about $350 with a pottability test included in Northern California.
Finally, check out the septic system and leach fields. If buying land, be sure the land has a "perc and mantel" (usually costs about $700-$1000; add septic design and it is more; if property does not perc you may not be able to build without the expense of a mound system which costs upward of $20,000 range). Be sure the septic tank size is big enough for the number of bedrooms you have or might wish to add. If more bedrooms are added, usually a licensed civil engineer can expand the leach field. A licensed septic person should be hired to inspect the septic tank (if seller does not furnish you a report) and also either buyer or seller may be responsible to have it pumped as needed; the inspection and pumping will run about $450 in Northern California and often negotiated. Note: You should not paddock horses over the septic leach field without possibly damaging the lines, especially if the lines are close to the top like some systems (especially mound septic systems). Casual grazing over leach fields is sometimes permissible but not systems with a mound (usually meaning there was lots of clay and underground water so requires more expensive mound septic system (ie, $20,000 appx). All inspection fees are usually negotiable between buyer and seller depending upon the county and state in which you are purchasing or selling property and/or its customary procedures (your Realtor can advise you). If you are the seller, inspections should be ordered up front, if at all possible, so you know where you stand in selling your property and about how much you should net after all fees and corrections. These inspections should include an natural/environmental hazard report which is mandatory in some states such as California, which will tell you if you are in an area of high fire hazard, earthquake hazard, high probability of radon gas, etc. etc. Also, in California now, buyers have to check the insurability of the property long before completing the sale. If they wait till the last minute they may find that the property cannot be insured adequately, especially if it has had a history of claims. Mold is particularly worrisome in some areas. Manufactured, log homes and/or A-frames sometimes present specific problems in insurance and with getting the best loans with lenders. Q. What trends are you currently observing in the sale of horse/equestrian properties in general? What is driving these trends? A. I see more and more people leaving the crowded city areas to escape to the peaceful and uncrowned rural hills and grasslands of California and other desirable areas. They are tired of paying high boarding fees and prefer to have their horses in their "backyard." Many are willing to commute as long as one hour to one and one-half hours to enjoy some acreage where they can allow their horses to occasionally graze around their country homes. A number are wanting to purchase property with room for a second home for family members or purchase acreage enough to enjoy building a covered arena and large barn. Many find that they can now enjoy the "good life" and telecommute or live in the city 3 days and come to the Ranch for 4 days. Often the wife and children stay in the country taking care of the animals. Congested cities and a desire for a more spiritual and peaceful way of life ---back to nature, I feel, are driving these trends.
Article by Marie Griffith, website publisher. _________________________________
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