How to Select a Farm Lease Type
There are numerous land lease types available to farm owners today. With the current agricultural climate, a good look at a few types is generally a good idea when trying to decide which is best for your farm. The farm management department of Iowa Land Management and Real Estate Company works with many types of farm leases.
In determining what type of farm lease best suits you and your operation, a discussion of your goals and objectives needs to take place. What are you looking for from the farm? Where do you see the farm in 5, 10, 15, 25 years? What do you want to be known of when people think of you as the owner of this property? What type of risk, if any, are you comfortable assuming in producing agricultural products on your farming operation?
After this discussion, we’ll be happy to recommend to you a farm lease type. It might be a straight cash lease that minimizes your exposure, but may not provide the returns that other types might. It could be a custom basis that may, depending upon productive ability of the farm, returns much more, but will involve a little more risk. It may involve one of many lease types that are somewhere in between the cash and custom arrangements for returns and risk. These would include the “hybrid” leases, or “flex” leases.
We are the originator of the “Equitable Lease”, a lease geared to allow the owner to take advantage of good grain prices, while limiting the amount of crop that the tenant has to “use” for the rent. Be sure and ask us about this one!