Posted on 04/03/2008 2:28:42 PM PDT by kiriath_jearim
Bummer - and it won’t end there. Sad to see America fall down like this.
hmm. those who play by the rules arent affected.
Bingo.
I’m not sure how much of this to believe. Farm commodities prices are at record highs. Agricultural land in most states (certainly in the mid-west) is selling at record high levels. USDA reports farm incomes have never been higher. Friends tell me there is a one-year waiting list for new John Deer combines. Seems there are a lot of farmers doing pretty well.
“The empty houses are vandalized.”
The person or bank who acquires the property at auction would be wise to let the former owner stay there at an affordable rate until the new owner is ready to exercise their plans or has an active live-in buyer. There could be laws passed that would allow quick eviction in such a case.
What a deceptive story. The “mortgage crisis” they cite had almost nothing to do with this particular forclosure. They do mention it later in the article, but then why use this case as an example of the problems caused by the “nation’s housing meltdown” in the first place?
Large farms tend to do better. Their owners are often either corporate, or well educated on the business side of farming. Small operations like the 25 acre dairy farm in the above story have a much harder time. Also large operations often produce several different things which helps protect when one is not doing so well. Only a small percentage of the money spent on farm products goes into the hands of the farmer. A lot of it goes into the hands of middlemen, supermarkets, processors, and transport.
Milk prices in CA surely havent fallen. They have banned imports from lower cost states.
B.S. People lose their family farms in a few different ways, but NOT due to the “housing meltdown.”
First, they’re dumb@sses that overextended themselves and then this happens:
a. No one in the family (usually the kids) wants to farm anymore or,
b. They didn’t know enough about their market to grow and change with consumer demands and just kept doing the same-old, same-old, losing money every season for years on end.
c. Their farming in a state like CA that couldn’t care less about them.
d. There’s no mega-farm in the area to buy them up and absorb them.
I know of dozens of young couples that would LOVE to have a small farm to run. People really are returning to the land, and that’s what I’ll cash in on within the next decade. I don’t care if I sell to Hippies, as long as they have cash in hand, Baby! :)
This author was just looking for a sad-sack story to tell about a poor cow farmer and tie it to the housing melt-down. Boo-Freakin’-Hoo.
I haven’t heard of anyone losing their farm here in Wisconsin due to “the housing market.” Most farmers already have their HOUSE and LAND paid for. They may still owe on machinery, some of which starts at $500K for a used piece of equipment. But the house is sell-able, as is the land if you’re in that dire of straits.
But, that’s life in the Midwest. We’re pretty well insulated from the horrors of life on either coast, Thank God! However, the number of Liberals surrounding us makes us VERY nervous for the future of Ag in Wisconsin.
Full disclosure: I married into a farming family. We’re small ‘taters compared to most, but on our road (from one town to the next, about 15 miles) we have two dairy farms, a self-supporting prison farm, five stables, and close to a dozen farms that produce corn and soybean. My in-laws plant about 200 acres of seed or feed corn each season. The 700 acres around my “farmette” (I only own two, but I look very “land wealthy”) are either soybean or feed corn or sweet corn; it rotates.
I recall farms in trouble after the Carter years. I lived in an area where some went bankrupt or foreclosed. One of the reasons was that the US dept of Agri taught farmers how to “hedge the inflation.” - get loans on the spiraling upward inflation whereby they bought more and fancy equipment than they needed. When Reagan came in and inflation was checked, they lost their shirt (and a lot more)
The other problem according to the business community, was that quite a few farmers in trouble suffered from poor farm management skills. Two like farms, one well managed and doing well. Down the road the farmer went under - poor management, including wasteful spending - down the tubes.
I wonder if some of these farms in trouble today are following suit.
While we like to think it will only be the truly foolish or risky who’ll suffer, the fact is everybody will be aversely effected by the credit crisis.
In order:
1) Anybody who’s bought a home in the last 5 years will be faced with negative equity. (Walking away will be considered a good business decision).
2) Property Tax Rates will need to go up, because housing values will go down.
3) Fire and Police costs and Crime will increase because abandoned houses draw unsavory elements to neighborhoods (especially out in the Exurbs and Suburbs).
4) Big Businesses will find it harder to raise money, slowing down any expansion.
5) Banks will be even more risk adverse, making it harder for small businesses to expand.
Yep.
Sounds to me that these guys just didn’t make it in the long run, like . . . say . . . a whole bunch of other family/small businesses every year.
It’s not just in the rural areas, its everywhere. Unfortunately, some of this stuff is just another scam and more people gaming the system.
Your argument
No way would everyone let homes fall to that level. Everyone would start buying and buying because we would never see such an opportunity again.
Sound like you can start getting that cash warmed up. We are at 50c on the dollar in some area and headed lower. That Govt. bailout of 1200.00 aint going to work with 3.50 gas prices. In most cases it will be like throwing gasoline on the fire.
There it is. They refinanced, i.e., they borrowed money against the inflated value of their farm and couldn't pay it back. Now the congressional mealy mouths want to make all of these spendthrift borrowers whole with the taxpayer guaranteeing the new financing. Isn't it great to be an American!
California is dying because of liberal control!
Just look at thier track record in other states.
Droughts, tornadoes and other extreme weather can destroy farm income, injure animals, and end a season with no money made. Farming has vulnerabilites that can cost a year or two’s profit, and if you have people to pay, then you pay whether you make money or not. That is why many borrow, and then if they don’t do well next year...and on and on...
Equipment breaks down, and replacement is astronomical dollars, and repairs aren’t cheap. There is nothing deceptive about how fragile farming can be.
It isn’t nine to five, you pay your own insurance, and your own hospital bills....no retirement unless you save it...
Believe it. Dairy farming is a hugely capital-intensive proposition, especially in California.
You need to go to California and observe their dairy industry.
If you do, you’ll go back to Wisconsin and thank God that you’re farming there.
And to your point (c): No, the pols and people of California don’t care about farmers any more. They regard farmers as a problem, not an asset.
They probably were not bright in how they took on too much debt, but that’s not unusual in western farms. I’ve seen potato farms, HUGE operations, in Idaho go belly-up after only one bad season. Same deal for onions. In California, you see this same pattern in dairies that overextend themselves. There’s a huge pressure on dairies in CA to “get big or get out.” They’re often operating with very high debt loads, and they’re constantly trying to add fresh cows to increase their cash flow. Bankers in CA used to lend on the cash flow. Now, with so many local commercial banks in CA refusing to lend for any reason (because their balance sheets are a complete wreck), I can see how these farmers were indirect victims of the housing situation in that their lender used to lend to them, but refuses to do so now.
Seriously, if you ever get away from the farm for a bit, go to California and see how they dairy there. You’ll be shocked, amazed and frightened. All at the same time.
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