Twelve Reasons to Buy Virginia Timberland as an Investment – Reason Number 11

Land Use Taxation Most counties in Virginia have adopted a land use tax.  This tax rate reduces the annual real estate tax on land that is used for agricultural or forestry purposes.  The reduction in annual tax can be quite significant. There is a provision whereby the county can recapture some of the deferred real estate tax.  Typically, it is limited to the tax reduction the previous five years plus some sort of interest on those deferred taxes. The trigger for recapture is if the use of the property is changed from agricultural or forestry into residential or some other development.  Often just the act of rezoning will trigger the recapture.  However, land use taxation can greatly benefit the bottom line of holding a piece of timber land. We hope that the information we are sharing will assist you in making a timberland investment.  We believe doing so will make you look brilliant over the next 10 years.  Call us, at Grant Massie Land Company we love to help our clients look...

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Twelve Reasons to Buy Virginia Timberland as an Investment – Reason Number 10

Alternative Sources of Revenue Owning timberland means the need to pay real estate taxes.  Also involved in timberland ownership is the maintenance of roads into the tract for access. One of the trends that we see in working with timberland is the increasing difficulty of hunt clubs to find tracts of timberland where they can hunt.  In the past, many hunting leases were informal and very few, if any, rental dollars were involved. However, the shortage of tracts to hunt means that hunt clubs are today paying increasing rents for the privilege of hunting.  This is not yet a huge source of revenue but it is increasing annually. The compensation from a hunt club usually comes in the form of a combination of maintenance of any interior roads as well as cash rent.  The amount of the annual cash rent today is typically equal to or greater than the annual real estate tax. This trend of increasing rents for hunt clubs will probably continue.  While no one today would buy timberland for the annual hunting lease rental income alone, it is an important source of income for a timberland owner. We hope that the information we are sharing will assist you in making a timberland investment.  We believe doing so will make you look brilliant over the next 10 years.  Call us, at Grant Massie Land Company we love to help our clients look...

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Twelve Reasons to Buy Virginia Timberland as an Investment – Reason Number 9

Wood Fiber in Food? Organic pre-shredded cheese contains powdered cellulose in order to repel moisture.  Cellulose gum is used in beer production.  Purified wood pulp is used in low fat ice cream. Obviously, none of these have so much wood fiber as to taste like wood, but as an additive, they are critical.  As more of those products are consumed, the demand for cellulose and other wood products will increase. Remember our discussion about demographic trends here in the USA?  Add to that the expected population growth of the world from 7 Billion to 9 Billion by 2050.  More people means more food and beverages.  As a timberland investor, you benefit from that trend. We hope that the information we are sharing will assist you in making a timberland investment.  We believe doing so will make you look brilliant over the next 10 years.  Call us, at Grant Massie Land Company, we love helping our clients look...

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Twelve Reasons to Buy Virginia Timberland as an Investment – Reason Number 8

China One of the major forces in the world economy today is China, the second largest economy in the world.  While most of their housing is substandard by American criteria, they have been building a lot of housing units trying to improve their housing stock. Because they are a communist country, their economy is centrally planned.  The leaders are not elected but they do like their positions and 1.3 Billion folks is a lot of people to have mad at you. In order to provide jobs and hoping that will mean stability in their country, this Spring the Chinese leaders announced that they were hoping to build over the next five years a huge number of housing units.  If my memory is correct, the number was 90 Million.  I do remember the comparison was that it was more units than the total number of apartments that exist in America. An indication of the impact on our timber market is that in 2009 China imported $511 Million of American timber and saw mill products, but by 2011 that total came to $1.8 Billion.  The announcement of their housing construction plans suggests that they will need even more of our timber and saw mill products. We hope that the information we are sharing will assist you in making a timberland investment.  We believe doing so will make you look brilliant over the next 10 years.  Call us, at Grant Massie Land Company we love to help our clients look brilliant....

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