The mystery behind aggressive bidding and record land values
An ag real estate expert says aggressive bidding is leading to record land values in most areas of the Corn Belt.
Randy Dickhut with Farmers National Company says quality farmland is up nearly 35 percent and supply and demand can be blamed. “Supply of land for sale was still lower going into the year, but that accelerated as higher prices brought out more sellers and so we did see an uptick in the amount of land sold.”
Dickhut says there was strong farm income from 2020 and that spilled into last year and was eventually bolstered by high commodity prices in 2021 and that contributed to high demand. “Having that stronger position, that gives farmers and producers confidence to buy that piece of land that comes up for sale once every three or four generations and fits into their operation or is close to them.”
Farmer Logan Bredemeier tells Brownfield ground is hard to come by in Southeast Nebraska and some land recently sold for $7,000 to $15,000 an acre – an increase of over 150 percent from last year’s average of nearly $5,500 an acre. “It’s tough. Very little. There have been about two auctions in the area in the last two months. Tight supply and very pent-up demand.”
Nebraska’s average for farmland jumped six percent from last year to nearly $3,000 per acre but varies widely regionally.
Dickhut says additional buying interest during the past year came from individuals looking for an inflation hedging investment or the security of a farmland asset, too.