Pros and Cons of Buying Land in Tennessee

Thinking about buying land in Tennessee? It's a decision that comes with its share of ups and downs. The Volunteer State's rolling hills and thriving economy have caught the eye of many land buyers, but it's not all smooth sailing. Take the state's farmland, for instance. Tennessee's got a hefty 10.8 million acres of it, with farms averaging about 155 acres each. Not too shabby, right? And in 2021, crop sales hit a cool $2.1 billion. But here's the kicker - only about 41% of Tennessee's land is considered prime for farming. That's according to the folks at the Natural Resources Conservation Service, and it's something to chew on if you're eyeing agricultural land. So before you jump in, let's break down what makes Tennessee land a potential gold mine - and what might make you think twice.

Getting Acquainted with Tennessee

Stretching from the Appalachian Mountains in the east to the Mississippi River valley in the west, Tennessee packs in immense geographic diversity. The state is bordered by eight others: Kentucky to the north; Virginia to the northeast; North Carolina to the east; Georgia, Alabama, and Mississippi to the south; Arkansas to the west; and Missouri to the northwest.

About 6.7 million people call Tennessee home. The state’s total land area is 42,143 square miles—that’s more than Belgium! Most residents live in urban centers or suburbs, though rural areas still comprise much of the state.

Tennessee’s climate is generally mild, with humid summers and moderate winters. The average summer high temp is 89°F, while typical winter lows hover just above freezing at 34°F. Rainfall is plentiful year-round, supporting lush forests teeming with biodiversity.

The state has a diversified economy anchored in agriculture, manufacturing, healthcare, and tourism. Major corporations like FedEx, Dollar General, and AutoZone are headquartered here. Billions of dollars flow from key Tennessee industries like cattle farming, auto manufacturing, and whiskey distilling.

From blues on Beale Street to country tunes on Lower Broadway, Tennessee has undisputed music credentials. And attractions like Dollywood, Graceland, and the Great Smoky Mountains fuel a $20 billion tourism industry.

With this basic lay of the land, let’s look at the pros and cons of buying property in Tennessee.

The Potential Perks of Tennessee Land

It's easy to get swept away by romantic visions of life as a Tennessee landowner. Here are some of the key benefits that can make buying land in Tennessee highly appealing:

Breathtaking Natural Beauty

From soaring Appalachian peaks to rolling pastures, lush forests, and serene lakes, Tennessee's landscapes are stunningly beautiful. Owning a piece of this natural splendor is a dream for many. Just picture having mountains, waterfalls, or thick woods right in your own backyard.

Four Distinct Seasons

Tennessee's moderate climate brings four distinct seasons, each with its own charm. Spring and fall are pleasantly mild. Winters are chilly but not extreme. And even steamy southern summers have slower rhythms and firefly-filled nights.experiencing nature's yearly rebirth is special.

Low Property Taxes

This is a major money-saver! Tennessee boasts some of the lowest property tax rates in the U.S. The average effective tax rate is only 0.69%. And residential rates start at just 0.25%. Snagging a Tennessee land deal means keeping more cash in your wallet.

Business Friendly Tax Structure

In addition to low property taxes, Tennessee also offers corporate tax incentives and business-friendly laws aimed at attracting new companies. Major brand names like FedEx, AutoZone and Dollar General have headquarters or major facilities in the Volunteer State. For entrepreneurs and investors, this economic environment enhances land's income potential.

Tourism and Recreation Galore

From Nashville's legendary honky tonks to Dollywood's roller coasters, Tennessee draws over 100 million visitors annually. Owning land near major attractions like Memphis' Beale Street, Jack Daniel's Distillery or the Great Smoky Mountains creates lucrative rental income and Airbnb potential.

Outdoor recreation also abounds, with activities like hiking, fishing, hunting, boating and camping. Investing in land lets you fully partake in Tennessee's natural riches.

Farming and Agriculture Opportunities

Tennessee's long growing season and high-quality soil make agriculture a $3.9 billion industry here. There's ample opportunity to generate income through farming row crops, produce, cattle, timber or specialty foods. Or lease your land to operators. Either way, agricultural land is a valuable asset.

Possible Downsides of Tennessee Land Ownership

At this point, Tennessee land is sounding pretty idyllic. But before breaking out the overalls and straw hat, make sure to weigh some potential challenges too:

Wildly Varying Property Values

Land prices fluctuate hugely depending on location. In booming cities like Nashville, an acre might cost well over $1 million. Just a short drive away in rural areas, land can sell for $2,000 to $5,000 per acre. Do your homework to understand values in your target area.

Seasonal Tourism Traffic

In mountain regions especially, tourism is concentrated in summer months. If you hope to generate rental income, your property may sit vacant much of the year. Managing this seasonal cash flow takes planning.

Extreme Weather Events

From thunderstorms to flooding and the rare hurricane, extreme weather happens in Tennessee. Make sure your land and any buildings are properly insured to minimize financial risks from disasters.

Patchwork of Development Laws

Zoning regulations, construction codes and permitting processes vary widely across Tennessee's counties and towns. Research all local rules thoroughly before investing to ensure your plans are feasible.

Limited Public Land Access

About 90% of Tennessee is privately owned. Public lands are scattered and concentrated mostly in state parks, wildlife areas and the Great Smoky Mountains. If convenience to public lands is important, research proximity.

Ongoing Maintenance Costs

Even raw land comes with ownership costs like property taxes, insurance, maintenance, and general upkeep. Building also requires utilities, construction, and roadwork. Budget adequately for responsibilities of Tennessee land ownership.

Key Buying Considerations

If Tennessee land ownership makes sense for you, keep these key factors in mind while searching:

Location, location, location – Property values, amenities access and growth potential vary enormously based on precisely where land is located. Do your homework on sales trends and prices in target areas.

Topography – Hilly and mountainous terrain dominates East Tennessee especially. Choose land with your intended use in mind, whether building, farming or recreation.

Access – Ensure there’s adequate road access to the property and ability to extend utilities if needed. This affects building feasibility and convenience.

Permitting – Research local zoning, rules on allowable structures, and other regulations. Make sure your plans align with what’s permitted.

Flood zones – Flooding can be an issue in low-lying zones near rivers or streams as well as from storm runoff. Check FEMA flood maps.

Surroundings – Drive by any property first to get a feel for what’s around it. Look for red flags like encroaching development or eyesores.

Bottom Line - Is Tennessee Right for You?

Only you can decide if the rewards of Tennessee land ownership outweigh the risks and responsibilities. But if its natural beauty and friendly way of life call to you, don't tune them out!

Do your due diligence. Understand all the pros, cons and variables. Partner with knowledgeable local real estate pros.

Then who knows - you may just find yourself living the Tennessee land ownership dream, sipping sweet tea on the porch of your new log cabin hideaway. Here's hoping your Volunteer State adventures deliver all the rewards and magic you envision!

Frequently Asked Questions (FAQs)

How much does land cost in Tennessee?

Land prices vary wildly across Tennessee. In booming big cities like Nashville or Knoxville, an acre of land can easily top $1 million. But just a short drive away in rural small towns, an acre of land might sell for $2,000 - $5,000. There are deals to be found, but location makes a huge impact. Do plenty of research on recent sales and listings to understand the true market value for different counties and towns.

What taxes and fees come with owning land in Tennessee?

You'll need to budget annually for property taxes, insurance, maintenance costs and any homeowner association dues if part of a development. Property tax rates are low, averaging just 0.69% of assessed value statewide. But counties and cities add on fees for things like roads and fire service too. Confirm all recurring costs of ownership before buying so there are no surprises.

Should I buy woods, farmland, or development land?

This depends on your goals. Wooded mountain land provides privacy plus hunting, hiking and scenery. But it often can't be developed much. Farmland offers income potential from crops or livestock but requires agricultural work. Development land near growing cities allows building but is pricier. Decide based on your lifestyle vision and budget.

What rules apply to building on land in Tennessee?

Zoning laws, construction codes and permit processes vary by county and city across Tennessee. Research local requirements early. Some rural counties have minimal red tape, while suburbs and cities often have tighter rules. Know regulations on allowable structures, septic systems, setbacks, utilities access and more before finalizing plans.

How do I find good land deals in Tennessee?

Great deals take work to find. Comb listings on Zillow, Redfin and LandsOfAmerica. Network locally and tell real estate pros what you seek. Drive backroads and look for old "for sale" signs. Knock on doors of abandoned or fixer homes and make offers. Check auctions and foreclosures. Partnering with an experienced Tennessee land real estate agent is your best bet for finding hidden gem properties.

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