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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: biometricgngboy who wrote (15149)	11/16/2003 9:02:13 AM
From: biometricgngboy	Read Replies (1) \| Respond to of 306849

Ranches evolve into high-priced estates Associated Press SILVER CITY, N.M. - There was no chance, really, that when the Greenwood Canyon Ranch went up for sale it would be sold to a cowpoke trying to make his living off the land. With 7,000 acres of high grass and major views, and a half hour's drive from art galleries, antique shops and espresso, the writing was on the wall: This would become a trophy ranch, another chunk of wild New Mexico landscape reduced to fenced home sites and strewn with gargantuan ridgetop estates. That, after all, is the way of the New West. Allen Torell, an agricultural economist at New Mexico State University, recently teamed with a colleague in Idaho to review records from about 500 ranch sales in New Mexico from 1992 to 2002. He found hard data to support what anyone who reads glossy real estate brochures has suspected - lush ranches with beautiful vistas have been increasing in value by 10 percent to 12 percent annually. "Ranch values have just moved completely out of line with the ability to pay for it with income from cows," Torell said. "Basically, you have to come to ranching with big bags of money, inherit it or be willing to work off the ranch." Or, as real estate agent Peter Frederick, said, "The cow business in New Mexico is done with. It's affluent people from out of state. And they pay cash." Frederick deals in beautiful country at high dollar. His nickname is "The Ranch Man" and his listings include a little 825-acre spread near Santa Fe for $7.4 million and a 6,655-acre spread near Tierra Amarilla for $6.6 million. Ronald Mayer, an agent who is based in Roswell and sells ranches in New Mexico, Colorado and Texas, said the lure of the land pulls in high-power people with lots of money who like the idea of owning some cattle and surveying their domain. "The people who are buying have no intention of making a living in the cattle business," Mayer said. "They're going to ranch. They will work it. But they don't have to worry about making it. It has nothing to do with economics. There's a wonderful mystique of possession and ownership where you can look out over what you own." When Jim Hatfield looked at buying the Greenwood Canyon Ranch, the ranch was already a couple of steps removed from a working cattle ranch. Hatfield found an investing partner in 2001, drew up covenants that prohibited fencing and ridgetop houses, carved the ranch into 11 lots ranging from 250 to 300 acres, and put the property on the market as Silver Bear Ranch. Lots cost $1.25 million and there's a luxury bunk house, a full-time horse wrangler and a permanent herd of cattle for all the property owners to share. In a perfect world, a rancher could have bought the place and used the land to support his family, Hatfield said. But, he says, "The places don't pencil anymore. You can't keep enough cattle to make a buck." Hatfield's plan is to keep horses and cattle on the land but add a few more people. Heritage Ranch, a real estate company, offers five properties in New Mexico that are being preserved as working ranches while offering home sites that range from 20 to 60 acres. The concept is to preserve traditional cattle ranches - more than 140,000 acres in all - by allowing a new breed of homesteaders to build their houses on the ranches and share in the open space. Like Hatfield's Silver Bear Ranch, part of the appeal to homeowners is the chance to live on a big ranch while only having to be responsible for a small ranchette. Heritage Ranches began years ago when rancher Jim Winder saw developers eyeing a neighboring cattle ranch near Hillsboro and wanted to save it from fencing. "You can stand in front of a freight train and yell, 'Stop,' and you're going to get creamed," Winder said. "We decided to try to guide the future." Heritage Ranch works because it allows a group of people to share in the costs of a large ranch while allowing everyone views and elbow room. In his study, Torell found the size of ranches sold in New Mexico varied from 320 acres to 180,000 acres and sales prices ranged from $14 to $1,000 an acre. Vistas of mountains or other spectacular scenery and wildlife added to values. The values of those "trophy ranches" leapt by 10 percent to 12 percent every year since 1996, Torell said. billingsgazette.com