Christmas Treem Farm --- Need Help

[kwolfe]

I tried to think of a catchy title, but that is all I came up with.

My wife and I have been seriously discussing buying 10-20 acres and starting a small, local Christmas Tree farm. I just don't feel good about going to to the big warehouse stores to buy my tree every year. Where is the fun in that. I highly doubt my sons (3 and 1 years old) will have fond memories of going with Dad to Home Depot to pick out the tree. Plus I think that it would be good for them to grow up knowing what it is to put in a hard days work.

We want something that the people in the local community can come and enjoy. Get a tree, have some hot cider, go on a wagon ride, and share some holiday spirit. My intention is to raise enough money to pay for new trees to be planted. I am not going in looking to make a profit. I simply want to provide a place where people can come and create long lasting memories. If I am lucky, maybe one of my own sons would take over one day and provide the same experience to kids he plays with now.

Here is where I need your help. I live in mid-state PA and am in the process of looking for land. As usual, money is a huge issue. 10-20 acres within a reasonble commute of my job goes for around $250,000 - $400,000. This is steep considering I still need to put a house on it.

I have looked into easement donations for a tax deduction, however this not wind up being that much money at the end of the day. I am looking for ways to make this dream happen, however short of a charitbale donation or some kind of land grant to help out with the initial cost, I am not sure what I can do.

Sorry if I got a little sentimental for a moment. Any help/comments are welcome. Thank you.

 

[Oleozz]

Not sure what part of central Pa. you live in but if you are serious about the land buying there are some counties where land sells for fairly reasonable prices. Snyder Co still has land that is a bit below average for this area but getting higher by the month. Clearfield Co is another spot where land is reasonable but it's not in central Pa. Here are a few examples of land prices for Clearfield Co.: 112 acres, woodland and fields for $137,000, 67 acres, woodland and fields for $83,000.
In Perry Co there is an 84 acre farm with an 8 rm house, 2 car garage for $424,000.
Every week in the Lancaster Farming magazine there are 8 pages of properties for sale across Pa., some being sold by realtors and some by private individuals.
Just a thought on the tree farm, lots of work and not much income. I've been there, done it, and am glad I'm not doing it anymore. We sold douglas fir, concolor fir, and scotch pine. I never realized that pine trees were susceptible to so many different diseases and how many bugs liked to chew on them. It is rewarding to see them grow and thrive and does get you out with nature. Good luck in your search for land.

 

[kwolfe]

Oleozz,
I live in Dauphin County, but I work in just west of Lancaster. I will have to get a copy of the Lancaster Farming magazine. I am going into this expecting that it will be a lot a work, but like you said, it helps get the family outside and enjoying nature. Since I am not doing this for a living, it definitely relieves some of the pressure of having to have a perfect crop every year.

 

[Oleozz]

You will love that magazine. I read it from cover to cover. Be sure to check out the Mailbox Markets, there is all types of farming equipment for sale and sometimes you will find some real bargains.
I think you will find as you travel west from Harrisburg you will find cheaper land prices, with the exception being the State College area.

 

[SteelDust]

Here's something to consider... it takes 5-8 years up here in the Pacific Northwest, which has ideal fir growing conditions, before you have a tree that is able to be harvested. This means you will have to pay for the clearing, land prep, the trees, planting, fertilizing, trimming (every year sometimes twice, they don't get that perfect shape on thier own) for at least 6 years, without seeing a dime of incoming revenue to support your venture.

Obviously you will have to stage your planting, in such a way that you have trees that are ready for harvest every year...you don't want them all maturing at once, leaving you with nothing.

I would check with your local county extention to see if the trees that are currently in demand as Christmas trees will even grow in your soil type, climate, locale, etc before going much further.

Not trying to discourage you...just things to consider/look into.

 

[kwolfe]

Steel,
All good suggestions. As far as land clearing goes, I am trying to find a property that has previously used as pasture or farm land. I have put a lot of thought into this and realize that it will take quite some time for the trees to reach maturity. I am hoping that by the time the trees get to full height, my boys will be big enough to provide some real help.

 

[MuncyBob]

We actually live in the middle of a tree farm, we only own a few acres and the rest owned by a few guys. They have the land mainly to hunt but have leased out some land to people that grow and harvest the trees. I know land costs in your area are substantially higher than up here(near Williamsport) so it may be a bit more realistic financially to find land you may be able to lease(perhaps with an option to buy later)...in this way you can see if this is really right for you. From my observations there is a lot more work in rasing these trees than most people think...at least more than I thought!

 

[Kendall69]

Rather than farm trees, if I were to do it, contact some big growers in Oregon and negotiate a great price for cut trees. One time a guy offered me trees at I think $12.00 ea. for a 8' - delivered.
He comes down every year opens a small lot and sells about 100k worth of trees every year.

Growin trees is a slow slow business.

 

[MossRoad]

Check with your local county extension agent or state forester regarding Christmas tree farming. They will be happy to give you advice.

As for a jump on you growing, plant plots of seedlings, 1 years olds and two year olds the first year. That gives you a couple years head start.

As for your land prices.... OUCH!!!

 

[pappy19]

As a forester for the Idaho Dept. of Lands, I did an ecnomic study of Christmas trees for private landowners. Bottom line is you'll get at least 7 years of write-offs before you make a dime. That part is good. Then you'll get about 5 years of tree selling, and you can write off your expenses, and that's good too. But then you need to show a profit so the IRS won't take your shorts. Plus aside from the initial planting costs , trimming costs, fertilizer and watering costs, once you harvest, you'll have to indivudally remove the cut stump and replace the hole with good soil. Yes, some of the larger growers make money, but a small grower is just having fun, sort of.

 

[kwolfe]

Fun is the object here. I am not pursuing this for financial gain. I would like to provide a way to raise my children right and try to provide the community with a friendly service and found memories. I don't mind the labor portion either. I work at a desk most of my day , so any chance to get out into nature I take.

Mossroad,
I have looked into a local supplier of tree farm supplies. I would definitely go the route of planting saplings. If you buy in bulk, they are fairly inexpensive. Yes, land prices hurt. My wife still buys one lottery ticket twicw a week.

 

[Champy]

But then you need to show a profit so the IRS won't take your shorts.

I am in the same process only slightly ahead of you. Starting a tree farm on 34 acres, and planting our first 600 seedlings in the next week. Talk to your local State forester for soil tests and other guidance. You can even get subsidized and receive planting assistance to reforest open land (w/hardwoods though). Also, to meet the "you must attempt to make a profit" IRS requirement stuff (Hobby Farms), I am leasing out the unplanted cropland for soybeans / corn production. I then properly claim the lease on my taxes as income for the Tree Farm, hence no waiting 7 years and dealing with IRS audits with issues around having no income. I have farm income every year, but offset it with proper expenses, and use my CPA to document a long term harvest crop plan.

 

[pappy19]

Very good idea. Also, some growers sell the younger, less symetrical trees to landscapers. Just make sure they replace the soil with a good plug.

 

[Gatorboy]

Don't forget the cost of putting up a 10' deer fence all around -- unless you don't mind the deer eating up most of your trees.

 

[XmasTreeGrower]

Here is the best "primer" I have found:

Growing Christmas Trees in North Carolina

It will walk you through the process start to finish, and give you some ideas of the economics involved, and a tax guide.

I will second what everyone else has said; lots of work, and long years to even come close to a profit. We are on our ninth year now since initial planting, and are just now at break even.

Please don't think about paying those kinds of prices for land without doing thorough soil testing, and having you county agent look up your soil survey. Good drainage is critical. Just because it was old pasture doesn't mean much. Such lands are often severly compacted.

Have fun, but be prepared for years of committment, and hard work!

Here is a pic attached of one field of our 8,000 trees we have growing currently:

Thanks
Bill

 

[LoneCowboy]

As a forester for the Idaho Dept. of Lands, I did an ecnomic study of Christmas trees for private landowners. Bottom line is you'll get at least 7 years of write-offs before you make a dime. That part is good. Then you'll get about 5 years of tree selling, and you can write off your expenses, and that's good too. But then you need to show a profit so the IRS won't take your shorts. Plus aside from the initial planting costs , trimming costs, fertilizer and watering costs, once you harvest, you'll have to indivudally remove the cut stump and replace the hole with good soil. Yes, some of the larger growers make money, but a small grower is just having fun, sort of.

yeppers
You need to be running a real business. The general rule is the IRS expects profits in 2 out of every 5 years. (although you could make a good case for the first years of growing, and running a real business)
But without real profits, they'll go back and disallow all your deductions
This not what you want.