How a Recession Can Impact the Value of Property

The ebb and flow of our nation’s economy may be tricky to understand at times. From one year to the next, there are periods of growth and economic expansion, followed by economic slowdown.

Many industries that contribute to the U.S. economy operate cyclically, and included among them is the real estate market. While many factors may contribute to an economic downturn, it’s important to remember the economy moves in cycles, and that this is a part of the way a healthy economic system works.

What Is a Recession?

A recession is a decline in economic activity for an extended period, lasting from several months to years. A recession results when the country’s economy begins experiencing negative gross domestic product (GDP), increased unemployment levels, decrease in retail sales, and varying degrees of income and manufacturing within an extended period of time.

A recession is an unavoidable part of the business cycle, and results from a consistent pattern of expansion and contraction within the economy. Several factors may contribute to a recession, including effects from uncontrolled inflation or an economic shock. Most recently, the latest recession has been attributed to the COVID-19 global pandemic.

Buying Land During a Recession and Its Advantages

While it’s nearly impossible to accurately predict how long a recession will last, and how soon it may be before the economy bounces back, there are still smart investments you can make as you wait for an upturn.

The advantages of buying land during a recession include lower prices and increased inventory. However, like any major investment, it’s important for you to assess how much property you can afford based on your income and how to take advantage of great deals before prices go up.

During a recession, it’s not uncommon for property prices to drop, making the land-buying process more appealing to prospective buyers. During a recession, you can expect to find purchase prices well below what they would be during a stable and healthy economy.

Another advantage of purchasing property during a recession includes lower interest rates and more attractive mortgage terms. Because the real estate industry plays such a critical role in the economy, the federal government lowers rates to help bolster property sales by offering cheaper interest rates on mortgages.

Owner-Financed Properties Are a Great Alternative During a Recession

As a prospective buyer, if you don’t qualify for a traditional mortgage as a result of federal guidelines stemming from the recession, owner-financed properties are a great alternative on the pathway toward land ownership.

Owner financing means a property is financed by the seller. As mortgage rates rise amid the recession, and with variable property rates occurring, owner-financing is a smart choice during these times.

When you purchase a seller-financed property, you’re offered more flexibility when it comes to a down payment. When working directly with a seller to finance land, a customer won’t be required to meet bank or government-required minimums.

When you decide to purchase under owner-financing terms, you will also benefit from a faster closing, which translates to less time having to wait to begin the process of setting down roots. The benefits of purchasing owner-financed land mean a less stressful financing experience than what you’d usually expect from having to deal with a bank or financial institution.

SRC Land Is a Trusted Partner During Challenging Times

SRC Land has offered buyers quality land opportunities for more than 20 years. Our team has helped land buyers navigate uncertainty because we make the land buying process simple and reasonable.

Our dedicated team of realty experts can share their collective years of experience and knowledge to help you map out a promising outlook that includes land ownership. Recognizing that taking the first step toward land investment may seem daunting, SRC Land is committed to helping you through each step of the buying process.

Harlingen and the communities we serve are resilient, and despite current challenges, we can work together to weather any storm. Let SRC Land help you realize your dream of buying land in Texas, and securing a brighter future for you and your family.

It’s time to take the first step with SRC Land in the pursuit of securing a more prosperous future for you and your family. Reach out to us today to learn more about our properties and owner-financing options.

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Everything You Need to Know About Seller Financing

Financing real estate transactions follow a standard practice that involves factors such as meeting income requirements, employment verification, and assessing a prospective buyer’s credit score to determine eligibility for a mortgage from a bank or other financial lender. 

But what happens when a buyer isn’t able to satisfy the requirements needed to secure a traditional mortgage loan, yet still wishes to move forward with a real estate transaction? In these instances, seller financing is a great opportunity for a buyer to continue on a path towards homeownership while avoiding the restrictions of bank lending, and it is a service that SRC Land takes pride in offering to aspiring landowners.

Understanding Seller Financing

To put in the simplest terms, seller financing is the opportunity for someone selling a home or property to finance the purchase for a buyer rather than requiring a prospective buyer to seek a bank’s assistance in securing a mortgage loan. 

Seller financing grants the buyer a chance to purchase property quickly and at a lesser rate than that of a traditional and/or conventional transaction. 

Important Aspects of Seller Financed Real Estate

A seller-financed property will likely run for a shorter period than what would be expected as part of a conventional mortgage. It’s important for a buyer to inform themselves on the terms of the financing agreement to ensure a desired and favorable timeline for repayment. 

Both a seller and a buyer should hire a professional to prepare the contract and promissory note as well as discuss any matters that require further explanation or clarification. 

 Why Seller Financing is a Wise Move

Sometimes a mortgage isn’t easy to secure, and purchasing property under seller finance terms is a fantastic alternative in cases where there isn’t a clear path to move forward via a bank or financial institution. Accessing alternative forms of credit is an advantage for prospective buyers, and when a seller is financing a sale, oftentimes a property may command a higher sale price.

Aside from a quicker and less expensive way to buy a home, seller financing offers buyers the chance to save money on fees generally associated with traditional lending. In transactions involving only two parties, it’s appealing to be able to avoid many of the costs associated with conventional real estate transactions. 

Seller financing guarantees better terms than what a bank or financial institution would provide through their traditional lending options. A seller-financed deal may give a buyer more flexible terms, and access to more ideal financial options for their specific needs. 

Quick Guide To Common Types of Seller Financing

  • All-Inclusive Mortgage: Also known as an all-inclusive trust deed (AITD), this option offers the seller the option to carry the promissory note and mortgage on the entire balance of the home price deducting the down payment. 
  • Junior Mortgage: If there’s reluctance from a lender to finance more than 80% of a home’s values, sellers may extend credit to the buyer to make up the difference. The seller carries a second, or “junior” mortgage for the balance of the purchase price, deducting the down payment. 
  • Land Contract: Land contracts don’t involve passing the title to the buyer. Rather, the buyer is afforded an “equitable title,” or temporary shared ownership. A buyer will make payments to a seller, and once the final payment is received, the buyer receives the deed. 
  • Lease Option: This option allows a seller to lease a property to a buyer for a contracted term, much like ordinary rental property. However, a lease option lets a seller agree to sell the property to a buyer within an agreed-upon time frame and in return for an upfront fee. Varying terms under a lease option can be agreed upon between a buyer and seller, offering a flexible alternative to the traditional lending process. 
  • Assumable Mortgage: An assumable mortgage offers a buyer to take a seller’s place on the existing mortgage. In these scenarios, a buyer may assume a Federal Housing Administration (FHA) and Veteran Affairs (VA) loan, along with a conventional adjustable mortgage rate (ARM) with the bank’s approval. 

SRC Land works with customers to make the dream of owning land a reality. For over 20 years, we’ve offered seller financing options that work to put our customers on a clear path to a prosperous future by providing low down payments and affordable monthly payments regardless of bad or no credit. 

Let SRC Land offer you the best in seller financing options and an easier way towards realizing your dream of owning your own property.

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Take the Guesswork Out of Buying Agricultural Land With These 10 Easy Tips

Finding the ideal agricultural land for sale in Harlingen can seem tough. There’s a lot that goes into starting up your next farm or ranch, so researching what you need to start operations and what particular qualities various properties have before finding the one that aligns with your goals is key.

Luckily, SRC Land has 10 tips to ensure that the agricultural property you pick is right for you and whatever business goals you wish to meet.

1. Look into the Land’s Previous Usage

The land’s previous use could influence your decision to purchase the property. Land that’s been unused for decades may not have enough nutrients left for your crops. In addition, an area that was used for industrial purposes could have toxic chemicals residing in the dirt and water.
Research the land’s previous purpose so you can avoid threats and focus on finding property with healthy soil.

2. Test the Soil’s Acidity and Nutrients

Before buying farmland, make sure that the soil has the right nutrients and acidity to grow your preferred crops. If you realize that the farmland for sale doesn’t have the nutrients and acidity required for your crops, then you’ll spend time and money amending the soil before planting.

3. Pay Attention to the Farmland’s Soil Drainage

Well-drained soil protects plants from diseases including stalk rot, root rot, blight, and molds. Standing water also causes breeding grounds from problematic insects like mosquitoes, aphids, and beetles that eat leaves.

If you wish to begin farming immediately, buy farmland for sale that already drains quickly.

4. Analyze the Agricultural Land’s Topology

Most farmers avoid land with steep hills since water can wash away nutrients down the incline. Make sure that the agricultural farmland’s topography matches your crops’ needs.

5. Research Access to Resources

Some agricultural land can be found in the middle or outskirts of densely populated cities. Most farmland, though, is in rural regions. Based on the agricultural land’s location, you may not have access to essential resources such as water, electricity, and natural gas.

In certain scenarios, you can extend water and sewage lines to your farm or ranch by contacting your county’s Planning and Zoning Department. For electricity, search for your county’s preferred power company. The project could be pricey, though.

6. Know Whether the Existing Infrastructure Matches Your Standards

Agricultural land requires more than healthy soil. You need a farm infrastructure that helps you grow and sell crops. The most important kinds of infrastructure include:

  • Roads
  • Buildings
  • Irrigation
  • Electricity

Farmland roads have to accommodate heavy machinery like tractors, rollers, and cultivators along with trucks. Buildings, on the other hand, should offer a secure place to store your equipment and crops. You may need to build buildings like grain silos, packing facilities, and refrigerated sheds to sustain the freshness of your produce.

Irrigation infrastructure could involve drip irrigation systems that run along rows of crops or overhead systems that sprinkle crops automatically. Before investing in farmland, make sure it has an efficient irrigation system that’ll give your crops the right amounts of water.

Additionally, bear in mind that electricity becomes scarce when you travel deeper into a farm’s acreage.

7. Determine How Easily You Can Get to the Farmland

When you look at a map, the farmland for sale might appear to have a location just off a major highway or interstate when, in actuality, you may have to drive miles of country road to get from the interstate’s exit to property.

You may not mind driving an hour from your farmland to the closest major road; however, the issue is that you’ll need to haul heavy equipment and crops a long way numerous times a year. The duration and cost of driving your car 50 miles are significantly lower than the time and expense of hauling a 6,000-pound tractor down the same route.

8. Estimate the Distance to Distributors, Retailers, And Markets

You’ll also have to take into account the distance to distributors, retailers, and markets that purchase your crops.

Look for agricultural land that puts you within a fair distance of distributors and retailers. A centralized location that grants easy access to many of the area’s cities and towns could save your farm a lot of money.

9. Check the Area’s Cell Phone Reception

Today’s farmers need smartphones to stay connected with their employees, clients, and distributors. A region lacking good cell phone reception will make it challenging for you to contact the people who help your business succeed.

Check out the location and see how well your mobile device functions there. If you get poor reception, speak with your carrier about adding nearby cell towers, or if there’s no other alternative, you may want to choose a different property that already comes with good reception.

10. Research Whether Someone Owns Mineral or Gas Rights

Buying agricultural property doesn’t mean you own everything beneath the surface. Someone else could own mineral and gas rights.

For instance, if the previous owner owns the coal, natural gas, or other mineral rights on your property and you only have surface rights–that is, the property that your home is on–then they could have the right to enter your land and start mining in only as much of an area that they need to get the job done. You could check to see who owns the surface and/or mineral rights at your local County Clerk’s Office.

A ton of research goes into discovering ranch or farmland that meets your specific needs. Land real estate transactions require specialized expertise and experience, especially when it comes to finding the right farmland for sale.

Before investing in farm real estate, find a qualified seller-financing specialist at SRC Land to help you pinpoint the greatest opportunities for your purchase without pouring extra time and money into it.

Let SRC Land Be Your Helping Hand in Finding Your Dream Agricultural Property

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5 Ways to Increase the Value of Your Properties

Land is a valuable asset, and finding ways to increase its value when you’re looking to sell may be one of the smartest things you’ll do aside from the initial investment.

S.R. Campbell began doing business in land development in 1978, and for more than 20 years, SRC Land has made the dream of owning land possible for anyone and everyone interested. We’re here to help. With beautiful lots for sale in Harlingen, our experience and standards help our customers find everything they need to fulfill their home-living experience.

If you want to take advantage of the hot market, you’ll want to check out some of our expert tips on how to increase its value. Harlingen is a booming community, and growth trends and economic forecasts predict continued prosperity and opportunity on the horizon.

Here is helpful advice on increasing your property’s value and making it more appealing to prospective buyers.

1. Improve Your Property’s Curb Appeal

Curb appeal is an important aspect that doesn’t simply apply to homes. Improving your land’s appearance is a surefire way to increase the value, and improving curb appeal is an endeavor that can be done with or without the help of a landscaping company. Depending on the size of the property, many landowners are able to complete these tasks in the course of a short period of time.

Take a walk around the property and make a list of things that need to be done or removed to improve the landscape of the property. This includes simple actions including:

  • Removing junk and garbage on premises
  • Clearing overgrown foliage and weeds
  • Pruning trees
  • Clearing brush
  • Disposing of toxic chemicals or environmental hazards
  • Sealing unused/unsafe wells or water sources

Consider installing fencing as an investment to increase the property’s value. Prospective buyers appreciate the opportunity to purchase land requiring minimal effort to improve upon. Unattractive land with no emphasis on landscape translates to land sitting on the market too long, or invites buyers to present lower offers.

2. Improve or Offer Access

Consider the perspective of a buyer when a property doesn’t offer easy road access. Many times, a property may fulfill most of the needs of a prospective buyer, but difficult access to the land may be what ultimately becomes a dealbreaker.

If a formal agreement doesn’t exist, a landowner may consider talking to neighbors about applying for a legal easement. The process of creating an easement and road maintenance agreement is inexpensive; however, it’s important to consult with a title company and a real estate agent to verify the legal validity of the agreement.

Asphalt or concrete driveways are great options for improving access; if cost is a factor, a more affordable alternative would be to use gravel. These improvements increase the value of the property dramatically, and prospective buyers won’t easily overlook these benefits.

3. Consider Installing Drainage

Drainage issues are a concern for anyone looking to purchase raw land. Land with ineffective drainage or property where standing water remains following heavy rains are some of the least appealing properties to prospective buyers.

In fact, these issues are a significant reason why values plummet. Fortunately, issues associated with poor or non-existent drainage can be fixed easily with the installation of underground drain tiles.

The tiles are an affordable solution at just under $1,000 per acre and work to disperse the water, as a result making a property more attractive by allowing improvements needed for farming, grazing, and building.

4. Run Utilities

Running utility lines to a property ensures a significant increase to the land’s value. If a seller has the budget for improvements, running utility lines is a significant way of making a property more appealing. An ideal choice for buyers are properties with utilities, and the process is easier than you may expect.

Properties within city limits may connect lines on the street and landowners may then pay for hookup fees. For those whose property is located in a rural area, the process may require a bit more time, including planning and money. Other alternatives include solar or wind power. Property owners would benefit from running utilities as the investment will equate to adding 10-20% to your land value.

5. Trees and Added Land Value

Prospective buyers are interested in a property based on potential. If a property is on a spot that offers great views but is obstructed by trees, landowners would benefit in considering removing the trees to improve views.

A forest service office in your area can provide a list of forester consultants that can explain legalities and tax issues, and assistance with timber sale which would mean extra money for you.
As well, if your land offers access to unattractive views, planting fast-growing trees makes a property more salable, and helps reduce noise including that of traffic. The important thing to remember is that landowners can find many ways to improve their land value. With proper planning and strategy, earning potential can be increased and your financial future can look even more promising.

The First Step to Increasing Property Value, However, Begins With Becoming a Landowner!

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