January 28, 2019
One of the underpinnings providing support to land values the past several years has been the lower volume of land for sale on the market. From the peak in sales volume in 2012-2013, the land market experienced a 45% drop in sales over the succeeding years which continues today at the lower level. This was evidenced by sales volume and the number of transactions.
The Realtors Land Institute recently reported results from its annual survey of land brokers. In the report, they noted that the dollar volume of agricultural land sales from October, 2017 to October, 2018 rose only 1%. During the same time period, sales volume for Farmers National Company grew by 5% which followed annual increases since the fall off from the sales peak. These land sales came mostly from non-operating landowners who for various reasons decided that it was time to sell.
Going forward, the industry is expecting another small increase in sales activity for the year. Some regions are seeing a few more sales take place, while other areas continue to experience a derth of farmland sales. Non-operating landowners will remain the dominant sellers, but there is the general expectation to see a number of additional land sales caused by the continuing financial stress in production agriculture. The amount of financially caused sales is not expected to be large, but there will be somewhat more of these throughout the coming year.
Senior Vice President - Real Estate Operations
|Category: Agricultural Real Estate News|