Home » Blog » Is a Ranch a Good Investment?

Is a Ranch a Good Investment?

Little girl in a cowgirl costume

Many find the thought of owning a ranch tremendously appealing. The promise of lots of fresh air, a less frenetic lifestyle, and living off the land may seem idyllic. But things don’t always work out the way we picture them; ranching is serious, hard work. We should never walk into a ranch investment without first thoroughly studying and understanding what rural living and ranching entails.

Buying a ranch will require a sizable investment – possibly the biggest you’ll ever make in your life. It’s not a decision you should take lightly – certainly not without first consulting with someone who’s got years of ranching experience and know-how tucked under his belt.

Also get help from experts who can help you make a smart decision that’s driven by economics rather than gut feel alone. This includes your broker, banker, and any partners you may be considering for your venture. Be open to learning from a diversity of resources and be willing to work hard, plan ahead, and ready to roll with the punches.

If you’re planning on a working ranch that’s meant to generate income, here are some things to consider:

How much work are you willing to put in?

A rancher’s lot isn’t easy. You’ll need to be up by the crack of dawn, work out in the hot sun or pouring rain, and put in hours of often-backbreaking work. A typical day will involve feeding your livestock, finding the time to send the kids off to school, mending equipment, running essential errands, making rounds to check on your animals, and a whole lot more. Before you decide to buy, honestly gauge how much work you’re willing to put in.

How much land do you need?

This depends on what you’re planning to use the land for. If you intend to raise cattle, consider that each animal will eat about ½ ton of hay per month; this means 30 acres of land for food per cow. A 1000-acre property can essentially support just as little over 30 cows.

Understanding land quality

Not all land is suitable for growing certain crops or for working and raising cattle to generate an income. Learn about the land’s history and quality by checking with the county’s Natural Resources Conservation Service (USDA) office. A broker with expertise in land in the area can also be quite helpful in helping you understand whether the land you’re considering is a good investment or not.

Your financial investment

How much will my ranching endeavor cost me? There’s no quick answer to this question. A lot of things need to be considered, not the least of which is the cost of the land itself, the equipment you’ll need, the livestock, storage, fencing, feeds, corrals, veterinary fees and, of course, your employees.

If you’re raising cattle, you’ll need to understand how to break down your expenses “per cow” so you can price your livestock appropriately and make a profit off of your endeavor.

Don’t rush things

Be thorough in your search – there are a great many land options available and it’ll pay to be picky about finding the right property for your needs. Once you find “the one,” you’ll be able to enjoy and profit from your land in a multitude of ways.

Want to learn more about buying and owning a ranch in South Texas? Get in touch with us at Desert Flower Realty. Call 361.449.2051 or email DesertFlowerRealty(at)DesertFlowerRealty(dotted)com. Our local experts will gladly assist you with your inquiries.