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January 14, 2019
The new year is only a few weeks old and we are already seeing variations in the land market around locations, price strength, and buying interest. This is not unusual, but in today's environment loaded with uncertainties, each factor influencing land values and volume of sales takes on increased significance. Some factors support land prices and others may put pressure on sales.
Location-location-location is an old real estate standard. For ag land, location has many aspects that influence the land market and sale prices. Right now, areas of the grain belt that experienced lower yields will see increased financial stress among some operators which may carry over into the land market with increased properties for sale and somewhat less demand. Other areas had record yields and coupled with the MFP support payment for soybeans, may have producers feeling better about their finances for another year. Location can also mean the difference between a high quality farm that will bring the most aggressive bidding and a lower quality farm that may have less demand.
In looking at recent Farmers National Company land sales, the variations are evident. Good quality land in strong production areas brings good prices. Some regions and local areas are experiencing less aggressive bidding for ag land. Other factors that will influence the land market are also in play as the year moves along. These include knowing when and if we will see a positive end to trade uncertainties, how well the refinancing season goes for operators, and ultimately, will we see better commodity prices during the 2019 season. Stay tuned for a very interesting 2019!
Senior Vice President - Real Estate Operations
|Category: Agricultural Real Estate News|