vendredi 28 juin 2019

Land Contracts: Buying Land with Perpetuities

My question involves real estate located in the State of: Kentucky & Indiana

I recently passed an old farmhouse and field that was neglected but quite obviously the last farm left in a developed subdivision and it got me thinking about perpetuities. (I'm not a lawyer, but have had a few law classes, so correct me on any of this I get wrong, but this is my understanding of it.) In short, what I remember is that you can establish perpetuities in your will so long as they don't violate the RAP. Perpetuities are restrictions for land use written into a will, that if violated, affect property ownership. I remember an example in a book of a farmer willing his farm to his son, provided that he maintain it as a dairy farm. Perpetuities have a time limit, which at least used to be based off of a relevant person's lifespan - but I think it is 90 years now(?). So, theoretically there are properties out there with perpetuity rules extending up to 90 years from now.

(I used to go to school next to a subdivision with a tree in the middle of a road because the farmer who owned the land had included a perpetuity in his will that a specific tree never be cut down; his son sold the property to a developer who specifically paved around the tree.)

Because of the inherent restrictions, I assume that perpetuities decrease land value - but they would not be problematic for a person who was willing to work with the restrictions. Specifically, I am looking for a little farm in the Louisville area (a place where most of the farms have been developed already), but I am wondering if there are still farms preserved by those perpetuities. How do you find properties with perpetuities, if you are looking for sort of a niche? Is there even any point in looking? Finally, I know that there is a city land trust that holds a few farms with perpetuities (or at least, that it what it sounds like from the wording on their website). What does it mean for a land trust to own (but not necessarily take care of) land that "must be farmland" or "must be preserved as a watershed"? Is that generally land that you can buy?

Thanks! :D
Dr. D


Land Contracts: Buying Land with Perpetuities

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