By Nick Suess
Many owners of farmland find themselves in need of an appraiser only a handful of times in their life. Often, that is during a particularly stressful time when a decision to sell a family farm must be made in the context of a divorce or after the death of a loved one.
Certainly, asking about an appraiser’s fee and time frame is important, but beyond those, here’s a look at the top five questions to ask a potential appraiser:
1. Do you have experience working with agricultural properties? There are many excellent appraisers who don’t specialize in agricultural properties. The best appraiser in Illinois for apartment buildings may or may not know a farm from their foot! Not every appraiser works with every type of property. What’s their specialty?
2. Are you familiar with my property’s market area? Certain market areas may have specific factors that affect value. For example, a region might have mining activity that impacts the value of mineral rights. This would not be immediately apparent to someone unfamiliar with that market area. An appraiser familiar with your property’s market area will understand the nuance.
3. Are you familiar with unique aspects of this property? Farms are unique. Features such as development potential, wind leases, oil leases, solar leases, organic certification, permanent plantings and cellular towers can make a property more challenging to appraise.
4. If any of the aforementioned is lacking, how will it be resolved? Appraisal standards require appraisers to disclose when their knowledge is lacking for a specific project. They can still do the work, but only after some extra steps. After all, there’s a first time for everything. The appraiser must acquire the knowledge necessary and describe what he or she did to acquire that knowledge within the appraisal report.
5. What do you need from me? While a great deal of information about your property is publicly available, some important pieces of information are private. Farm Service Agency information is the best source for tillable acreage, Conservation Reserve Program information, highly erodible land status and wetland status. The appraiser can only access this with your written permission. You may also be the best source of information on other helpful factors such as location, size and age of tile; and exact ages of buildings. Help the appraiser help you!
Hiring a competent appraisal professional can give you knowledge as well as peace of mind. Starting off by communicating well about what you are looking for is an excellent way to have a good experience. For agricultural properties, ask if the appraiser is a member of the American Society of Farm Managers and Rural Appraisers. Appraisers in this organization will certainly have experience with agricultural properties. Ask the right questions!
Suess is a farm manager with Busey Ag Services, Decatur, Ill., and is a member of the Illinois Society of Professional Farm Managers and Rural Appraisers. Email questions to [email protected].