Many families are looking to purchase acreage to better fit their lifestyles. Whether they are searching for privacy, peace, or more room, the country is the perfect location.
The Kvalheim family wanted the space and flexibility they desired to create a small hobby farm. Here is their story.
For some people, living in the country is about more than a place – it’s living a lifestyle. The work that goes into having a larger property and engaging in farm activities is a key part of it. As Jim and Stephanie Kvalheim discovered when seeking their hobby farm, finding the right fit and having the support of experts can make that dream reality.
“Growing up on a farm, you learn a work ethic,” explained Jim Kvalheim. “We want to instill that in our kids – helping with chores, caring for livestock and exposing them to quiet, wide-open spaces.”
Their goal wasn’t to become full-time farmers – both have jobs in town – so finding just the right property was key.
“We wanted outbuildings for horses and perhaps a goat or two or a few head of beef cattle,” Stephanie Kvalheim said. “Acreage was important to us. And a move-in-ready home was a priority. Not a fixer-upper like our first home.”
What to consider in a
hobby farm
Chris Gartner, a lending officer with Compeer Financial with fifteen years experience, knows that there are key questions hobby farmers need to answer before they can zero in on the right property.
“You have to know the number of acres you can afford and handle, if you are going to have livestock or grow crops, and what kind of outbuildings you need,” he said. “It’s also important to factor in future plans and make sure the property can accommodate it.” Many hobby farmers might also need to finance equipment like a tractor or loader, and may want to add a shed or other buildings.
Financing all that can be a challenge with traditional lenders. Once they had identified their dream property – a 10-acre lot featuring a spacious house with lots of character and updated conveniences and outbuildings in excellent condition – the Kvalheims discovered quickly that buying a hobby farm required different capabilities in a lender.
Partners with deep rural roots show the way
“The lender for our first home was great, but we quickly learned they weren’t able to offer the financing we needed for an ag property,” Stephanie Kvalheim explained. “That was an unexpected challenge.”
Gartner explained why many real estate professionals don’t deal with rural properties. “Most real estate companies make money reselling the loans on the secondary market,” he said. “But the secondary market doesn’t always exist for rural mortgages.” As a result, the companies a person would work with to buy a suburban home might not touch a rural property. Even worse, they might back out late in the process.
The Kvalheims turned to Compeer, a lender specializing in rural properties, and found in their Compeer lending officer their guide to the sometimes-challenging world of ag real estate.
“He was fantastic,” Jim Kvalheim said. “He was incredibly informative and helpful. He put us in a place to look at all the pieces and moving parts objectively and make the best decision for our family.”
What makes farm properties special
Gartner said that this kind of expertise is especially helpful when seeking a hobby farm. “If a parcel has ag characteristics – if it has tillable acres where the highest and best use is farming, or specialized structures designed for agriculture – it can be harder for some lenders.” They might not know how to determine the value, and might not be sure they can make money on the loan.
A lender like Compeer, on the other hand, has deep experience assessing and lending for hobby farms, and has access to programs and markets specially designed for ag properties. Even when they won’t be full-time farmers. Chris notes that Compeer can also help finance the things that go with a hobby farm, like outbuildings and equipment.
A lifestyle like no other
Hobby farmers like the Kvalheims are happiest when they can focus on what they love – living and working on their land. By giving them the confidence and expertise to navigate the complexities of financing, lending officers like Chris can help hobby farmers achieve their dreams.
For the Kvalheims, who are raising their twin sons on their farm, relocating to their dream home was an important part of passing down values to future generations.
“The one thing I see in all the people I work with is a love of the land, a passion for living in the country” said Gartner. “The number of people who have grown up and been raised in the country is less and less. I hear people say I want to raise my kids on the farm, have them get that appreciation of the value of discipline and hard work – and also the joy that comes with it.”
