Farmland sales slowed down early in the pandemic but they’re roaring back. According to Federal Reserve Surveys of Agricultural Credit Conditions (Federal Reserve Surveys of Agricultural Credit Conditions), farmland values soared during the third quarter of 2020. In all Districts participating, the value of non-irrigated crops increased by at least 12%. Nearly all states saw an increase on farm real estate.
Randy Dickhut is Senior Vice President of Real Estate Operations at Farmers National Company. He said that land auction and sale activity in the fall of this year was higher than it had been in recent years.
Dickhut says that part of the six-months of selling was due to potential tax law changes, estate taxes changes, and stuff where people were trying for some of that. “So, that prompted some additional sales on the market in addition to the higher prices brought by that family group, the inheritors, and the estates or trust to sell land.”
He predicts that activity will slow down slightly as we approach 2022. But, going forward, farmer demands will be one of the underlying drivers.
“That’s going to hinge on what are commodity prices, the rising input costs, how will their net bottom line look and their optimism,” he says. “But I believe land prices will remain stable to firm, perhaps a bit higher in certain areas. We’ll be watching interest rates, inflation, supply and demand. Any of these factors could change or an unknown event could further affect the land market in 2022.”
Source: Successful Farming