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Demand for high quality cropland in Iowa remains strong despite the reduced farm income picture. "Values for good land have been fairly steady during the past year and have even seen a slight increase since harvest," according to Sam Kain, ALC, GRI, ABRM, national sales manager for Farmers National Company based in West Des Moines, Iowa.
"Buyers of farmland are being more deliberate about their decisions, but farmers and investors are very interested in purchasing the right piece of ground that makes sense for them. Lenders are being more cautious in the amount of money they will lend on a land purchase, but there is still enough capital in the country to create demand for good land," Kain said.
Auctions are still the predominate means to sell cropland in Iowa with more than 66 percent of Farmers National Company's sales in the state being through the bidding process. Sam Kain noted that 99 percent of the Farmers National Company auctions result in a final sale. "We have very good success selling land through auctions in our Iowa marketplace as there is competition from farmers and investors," Kain said.
Sam Kain, ALC, GRI, ABRM
Assistant Vice President of Real Estate
National Sales Manager for Iowa and northwest Missouri
Areas within this three-state region have been experiencing steady to slightly increasing land values. "In eastern North Dakota and South Dakota, we are seeing for the first time in three years a slight increase in the selling price for good to high quality cropland," said Brian Mohr, area sales manager for Farmers National Company in Garretson, S.D. Minnesota land values are holding steady from year ago levels, too.
Even though farm incomes have been challenged during the past three years, farmers are competing to buy good quality cropland. "Farmers are interested in adding the right type of acres to their operations and seem willing to bid up to get the land purchased," Mohr said. Conversely, range land in western South Dakota has not seen the buying interest or any strength in prices at this time.
"We are expecting a busy spring and summer marketing and selling land, as we believe there will be additional landowners wanted to sell at this time," Mohr predicted.
Area Sales Manager for North Dakota, South Dakota and Minnesota
Real estate sales activity in Nebraska has seen sales volume jump ahead of the previous levels in October and November. Paul Schadegg, area sales manager for the company said that "good quality land sells well, whereas lower quality crop or grassland struggles to find buyers."
"Farmers National Company holds many auctions in Nebraska with most all ending with a successful sale. That is a great outcome for our clients, especially during this slower land market," Schadegg said. Demand for high quality land extends throughout the state west to east.
Schadegg reported that sellers in the market at this time are mainly families and estates. "We are experiencing a land market with less property for sale and a more cautious demand. Some additional sales are expected before planting time from financially motivated sellers as the farm economy struggles with low grain prices," he said.
The land market in Kansas and Oklahoma is slower than normal, reports Paul Schadegg, area sales manager for Farmers National Company. "There is less land for sale than normal and buyers continue to be more cautious in making purchase decisions," he said.
"Good quality land sells well in most areas whereas lower quality crop or grassland struggles to find buyers," Schadegg reported. Overall, prices for good quality cropland have remained fairly steady during the past year in these two states while lower quality land may have a harder time selling.
The land market in Texas remains mostly stable. "The diversity of land in Texas, the wider range of buyers and the varied uses for land in the state all help contribute to the land market being more stable the past few years here than in the major grain producing states," said Paul Schadegg, area sales manager for Farmers National Company in Texas.
"We have a good supply of timber properties for sale in east Texas where there is good demand for these types of properties. Farmers National Company agents also have ranches, grazing land and cropland for sale over the rest of the state," he said.
Paul Schadegg, AFM
Area Sales Manager for Kansas, Nebraska, Oklahoma, and Texas
Land prices have flattened out in eastern Washington reports Flo Sayre, ALC, Farmers National Company broker in Pasco, Washington. Location and quality make an important difference in land values in the region along with the wide range of crops, fruits and vegetables that can be grown, all which influence the price of a tract of land.
"Investors are still searching for prime locations and high quality for crop production," Sayre said. She expects to see increased interest in selling land from aging farmers and potentially financially motivated sales. "Selling sooner than later might be a good strategy for anyone thinking of selling their land in the near future," she noted.
Cropland in Idaho remains steady at this time. "Good quality irrigated land in central Idaho is seldom on the open market and has good demand. This helps hold the prices steady, especially during a slow land market," reported Brian Mohr, area sales manager for Farmers National Company in that area.
Flo Sayre, ALC
Real Estate Broker for the Columbia Basin and Eastern Washington state
Quality is king throughout the eastern Corn Belt, reports agents in this region. "Good quality land is in demand in most regions. Prices for good land are steady to slightly stronger when compared to the same time a year ago," reported Roger Hayworth, ALC, area sales manager for Farmers National Company based out of West Lafayette, Indiana.
There is generally less land for sale now than a year ago, Hayworth said. "The low supply of properties on the market helps support land values in the region," he noted. "Auctions remain a good way to sell farmland in my area, but we are seeing some switch to more private treaty listings as the means to sell a farm."
As in most regions, sellers of land are mainly families and trusts. "Local farmers continue to be the primary buyers of cropland. We are seeing a few investors step back into the market, especially those with 1031 exchange money to invest," Hayworth said. "While the market is definitely slower, Farmers National Company's listing volume is up in the region compared to 12 months ago."
Area Sales Manager for Ohio, Indiana, Illinois, Michigan, eastern Kentucky, and eastern Missouri