EastWest Gal
Thinks s/he gets paid by the post
What would you do with this scenario?
Background: My father and his 3 sisters inherited a 20 acre orchard in 1988. My dad did all the financial stuff with the orchard, and did an ok job with it. One sister gifted her portion to one of the other sisters.
All remaining sisters have passed on. My dad first. I've been doing the money stuff for it since 2007. (it's leased to a farm family with generations of experience, and they take great care of it.) It's no work at all. Our net, after expenses, has been $16K-$30K/year.
The cousin who now owns a 50% share and lives in the area wants to keep it and is happy to have me take care of the money aspects--paying bills, doing the taxes, and sending him money. He checks on the property regularly. Another cousin owns a 25% share. He and his dad are business schemers. I'm not very happy having him as a partner. They've been pushing to sell the property since it was originally inherited in 1988. Always cash poor, but live in fancy houses.
This cousin approached me about buying out his portion. I'm offering $100K. It seems to be in the middle of the prices per acre I've seen the past 5 years.
BTW, the orchard is on low-lying land with it's own well and a high water table. Despite the California horror stories, water is a relatively small problem. The land has been planted with almonds since the 1930s.
Pros: 1. I'm more comfortable not dealing with this family member down the road. I'm sure he would be too.
2. The result is that two like-minded cousins will own the property 50:50.
3. It will probably take about 7-9 years to recoup the money spent on this. Not bad.
4. This is an ongoing source of income.
5. All of our income occurs at the end of the year. If I do this now, I get to keep his portion of the income.
Should I take out a loan?
Should I sell some equities?
Should I do this?
What do you all think?
Background: My father and his 3 sisters inherited a 20 acre orchard in 1988. My dad did all the financial stuff with the orchard, and did an ok job with it. One sister gifted her portion to one of the other sisters.
All remaining sisters have passed on. My dad first. I've been doing the money stuff for it since 2007. (it's leased to a farm family with generations of experience, and they take great care of it.) It's no work at all. Our net, after expenses, has been $16K-$30K/year.
The cousin who now owns a 50% share and lives in the area wants to keep it and is happy to have me take care of the money aspects--paying bills, doing the taxes, and sending him money. He checks on the property regularly. Another cousin owns a 25% share. He and his dad are business schemers. I'm not very happy having him as a partner. They've been pushing to sell the property since it was originally inherited in 1988. Always cash poor, but live in fancy houses.
This cousin approached me about buying out his portion. I'm offering $100K. It seems to be in the middle of the prices per acre I've seen the past 5 years.
BTW, the orchard is on low-lying land with it's own well and a high water table. Despite the California horror stories, water is a relatively small problem. The land has been planted with almonds since the 1930s.
Pros: 1. I'm more comfortable not dealing with this family member down the road. I'm sure he would be too.
2. The result is that two like-minded cousins will own the property 50:50.
3. It will probably take about 7-9 years to recoup the money spent on this. Not bad.
4. This is an ongoing source of income.
5. All of our income occurs at the end of the year. If I do this now, I get to keep his portion of the income.
Should I take out a loan?
Should I sell some equities?
Should I do this?
What do you all think?