No big changes anticipated in farmland values

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No big changes anticipated in farmland values

Farmland values remain mostly steady across much of the Midwest, despite continued weakness in farm income.

Tim Koch with Omaha-based Farm Credit Services of America (FCSAmerica) says low interest rates and good demand for a relatively tight supply of farm ground continue to provide support.

“We haven’t seen a surge of real estate available for sale, really, across any of the Upper Midwest,” Koch says, “and, overall, while we have pockets of stress in agriculture, there’s still a lot of equity and a lot of liquidity in the ag sector. So as farms come up for sale, we can continue to see pretty good demand for that limited supply.”

Koch says they don’t anticipate any major downward movements in farm real estate values over the next 12 months.

“Now, that said, if we were to see a spike in interest rates or a significant increase in available sales activity, I think those could have some limited downside pressure.”

Koch says federal aid has been critical to farm income—and absent additional federal support, financial stress could increase and lead to increased sales activity.

Koch is chief credit officer for FCSAmerica, which serves Iowa, Nebraska, South Dakota and Wyoming.

Link to FCSAmerica’s latest farmland values report

AUDIO: Tim Koch