Timberland property is good for investors who want to diversify their portfolio of holdings. Timberland ownership is considered a hard asset investment based on the physical and economic growth of trees. It is a secure and sustainable investment opportunity that can also be enjoyed by owners and their guests. Timberland properties are often used for various recreational activities.
Interestingly, even areas of timberland which are considered bare land (lacking trees) may appreciate in value, depending on market cycles.
Mitigated Risk
Managing timberland is not too risky a deal. Perhaps the biggest challenges to timberland include wind, fire, pests and/or disease. Therefore, it’s important that an owner actually take care of their timberland property over time. This can include managing the property in order to protect it from problems such as pests or disease. Owners with forestry knowledge have an advantage over those who aren’t familiar with such knowledge. That said, an owner can always hire a property manager who knows all about forestry to look after the land and make sure it’s not going to end up as a physical or economic loss.
Timberland management encompasses quite a few things, from management plans to timber sales, as well as planting, site prep, prescribed burning, investment analysis, and wildlife management. Managers should look over their land and take an inventory of all the trees on the property.
An Understanding of What You Have
If you’re going to manage timberland, you need to know what you have. The inventory process can include counting the number of trees per acre as well as the diameters of those trees. Soil quality can be evaluated so that growth rates can be estimated. Also, it’s a good idea to identify the species of timber on the property. Oftentimes, managers will literally make a map of the property and label trees and their associated information.
Timberland may be owned for several reasons. Owners should assess what they want to do with their property. Is it to be used for timber production? Is it to let the wildlife roam free? Is it for aesthetics, such that it looks good next to someone’s dream home? Owners and/or managers need to figure out the purpose(s) of their land.
Once the main purpose of the land is established, then owners and managers can discuss the ultimate desired outcome for the property. What are the goals for the year ahead, as well as 5 or 10 years down the line? Is it going to look like a park? Or will it be used for hunting? Which trees might you sell, versus which ones do you want to keep, for sure?
Listen to the Right Voices
Sometimes the scope of managing a property goes beyond one person. For instance, you might need to hire a registered forester to consult on various projects. Timber buyers can also be helpful in determining plans for timber management.
Timber sales aren’t frequent events. When they do happen, it’s good to have the assistance of professionals who can assess the value of the timber in question, in the current market. When timberlands are sold, inspections are usually done. Harvest agreements and/or timber deeds may need to be discussed.
Timberland properties are not only known for trees that produce an income for the owner, but also for being places to hunt, fish, ride ATVs, camp, and/or conserve wildlife/habitats. Ideally, if and when you own timberland, you should have a forest management plan in place, and you or someone who knows what they’re doing can manage the property so that it’s cared for and thoughtfully attended to as needed.
Also, look into reduced property tax programs for owners of timberland; Many states offer them. Consult with an attorney or tax professional or check this site.
Metcalf Land Company handles timberland properties for sale in South Carolina, North Carolina and beyond. Looking for timberland in places like Union, SC; Candler, NC; Campobello, SC; Cowpens, SC; Pickens County; Spartanburg County; or Oconee County; etc.? Call Metcalf Land Company of Spartanburg, SC, at 864-585-0444 for information.