Can You Sell Farmland During the Growing Season?
“Can we sell the farm when there is already a crop in the field?”
I hear this question regularly. The short answer is yes. A growing crop does not prevent a farmland sale, but it adds several details that need to be settled before the property goes to market.
The Lease
If the farm is rented, I begin by reviewing the written or verbal lease, who planted the crop, when rent is due, and what rights the tenant has through harvest.
In Minnesota, planted and growing crops are generally the personal property of the person or entity that had the right to plant them. A sale can close during the growing season while the tenant keeps access to care for and harvest the crop. The buyer then takes ownership subject to the terms of the existing lease, which is generally after the crop is harvested.
Additionally, determining who will work the ground after harvest should be addressed.
Rent and Income Must Be Clearly Assigned
The purchase agreement should state who receives the current year’s rent and whether any amount will be credited or prorated at closing. Generally, lease payments and taxes are prorated when closing takes place prior to harvest.
If the owner is operating the farm or has a crop-share arrangement, crop ownership, expenses, insurance, government payments, and sale proceeds may require additional planning.
Possession is Different from Ownership
The deed may transfer at closing, while full possession of the tillable acres is delayed until the crop is removed.
The sale terms should cover anything not addressed in the lease, such as field access, crop damage, fall tillage, fertilizer application, hunting rights, and responsibility for the property between closing and harvest. Clear dates and responsibilities help the seller, buyer, and tenant avoid misunderstandings.
Summer Sales Are Effective and Manageable
Summer farmland sales can work very well when lease, income, possession, and transition details are clearly addressed from the beginning.
It is our experience that values do not change with the season. When the time is right for your family to sell, proper planning and a well-executed process will help ensure a successful sale regardless of the season.
If you are considering a sale this summer, our team at Wingert Land Services is available to help you understand your options and build a process that fits your farm.