This bizarre investment strategy involves helping landowners take advantage of lower tax rates available for agriculture. In many places, land used for agricultural purposes is taxed at a lower rate than land that is used for residential or other forms of commercial uses. A piece of vacant land at a prime commercial location near a freeway and at a major intersection could be very valuable from a development standpoint. However, until it is actually developed, it won’t generate income. It will generate expenses, however, most notably property taxes. A property assessed in the millions of dollars could easily generate a tax bill in the tens of thousands of dollars. According to The Atlantic, this scheme saves Florida landowners about $1 billion a year in property taxes. Spending a few thousands dollars to rent some cows can be a tremendous bargain.
Buying a cow might cost $1200, maybe more and possibly even less. But dealing with the cow is about the last thing some wealthy property owner or land developer in Florida or Hawaii wants to do. Someone with even a basic idea about ranching stands to make a decent profit assuming they can buy the cows cheaply and that there is an adequate supply of water and grass to eat already on the property. They would also want to make sure there was already adequate fencing or other controls on the property to keep the cows from wandering off. Obviously someone who is actually in the dairy or beef business stands to benefit the most from rent-a-cows because they are not going to just buy a cow for the sole purpose of renting it out. However, there is nothing to stop and ordinary person or even an enterprising land owner from buying their own cows solely for property tax purposes.