THE IDAHO STATESMAN

BOISE, Idaho Milan Gould has been farming in the Middleton, Idaho, area, not far from the state capital of Boise, since 1959.

This year, rows of corn stretch from his property across 80 acres of the subdivision, which was once approved for about 200 homes and a park.

A lender ended up with the subdivision after developer Corinthian Homes defaulted on its loans, said Star, Idaho, Mayor Nate Mitchell.

Gould leases the land from the lender.

“It keeps the weeds down. It keeps the land in production. It gives them a tax break,” Gould said. “It benefits all of us and keeps us in business.”

During the boom years that drove up land and home prices, demand for new homes seemed endless. From about 2005 to 2007, many farmers sold out for cash, or committed portions of their land to developers. Plans for subdivisions that would gobble up farmland covered Idaho’s Treasure Valley.

But when the housing bubble burst in 2008, home buyers and construction loans faded. Deals fell apart. Developers and speculators found they had purchased too much property at inflated prices. As values dropped, many had more money invested than they could recoup by selling.

“After the shake-out, many of those properties (were short sales) or went to banks that have sold or are trying to sell them,” said John Starr, a land broker with Colliers International in Boise.

Other scenarios played out, as well, especially after farm income and prices for commodities like corn and wheat rose, said Idaho state Rep. Pat Takasugi, a farmer in Wilder, Idaho, who was once Idaho’s agriculture director.

Farmers continued to work the acreages they owned in fizzled subdivisions, he said. They also sought out owners of other parcels, whether investors or banks, to buy or lease land to plant crops.

Investors who lease to farmers benefit from advantageous tax treatment.

“Local farmers have done a good job of pressing developers, banks and owners to keep land operational,” Starr said. “If you find land sitting idle, it’s because they just haven’t found the right people to talk to or the owner said no.” Or because the developer built roads, sidewalks and utilities that make farming the land impossible.

Gould said he’d like to buy, but he chooses to lease land near his properties in Middleton because the investors sank too much money into them for development and need to make it back on the sale.

“I couldn’t afford it,” he said.

Similar Posts:

Share