How Farmland Really Gets Its Price

Most people assume selling farmland through a listing is the “normal” way to sell land.
You set a price, put up a sign, list it online, and wait for buyers to come along.

But the reality is very different.

A traditional listing is really just a series of one-on-one negotiations.

A buyer comes along and makes an offer. Then the negotiations begin — price, financing terms, contingencies, timelines, inspections, and other conditions. If the deal falls apart, the entire process starts over again with the next potential buyer.

Every new buyer means starting a brand-new negotiation.

Auctions work in a completely different way.

Instead of negotiating with one buyer at a time, an auction creates a competitive negotiation event where all buyers participate at the same time.

Before bidding ever begins, the seller sets the terms and conditions of the sale. All bidders compete under the exact same rules.

With a listing, everything is negotiated.

With an auction, the only thing negotiated is the price.

That difference changes everything.

While price can still feel stressful for sellers in any sale, auctions remove many of the other common stress points. There are no endless back-and-forth negotiations over contract terms, financing contingencies, or closing timelines.

When buyers compete openly against each other, they keep each other honest. The process is transparent, and the market reveals what the property is truly worth through ascending bids.

With a listing, the price is proposed by a buyer.

With an auction, the price is discovered through competition.

Auctions also create certainty.

The sale happens on a known date, with clearly defined terms and significant non-refundable earnest money from the winning bidder. Buyers know the rules ahead of time, and sellers know when the sale will conclude.

Listings, on the other hand, can drag on for months — sometimes even years — because there is no firm deadline and often very little urgency.

Both methods can sell land, and we’ve successfully used both many times. But after working through hundreds of farmland transactions, the differences in the process become very clear.

Auctions simplify the sale. They remove much of the stress that comes with endless negotiations and give the seller far more control over how the transaction unfolds.

Sometimes the biggest advantage of an auction isn’t just the price.

It’s the clarity of the process.

Over the years, I’ve watched many sellers go through both methods. Many begin thinking a listing will be the easier path.

It rarely is.

But once they see how simple an auction can be — one day, one event, all buyers competing at once — they often realize the process can actually be far less stressful than they expected.

Thinking About Selling Farmland?

If you are responsible for selling inherited farmland or managing an estate land sale, understanding the dynamics of the local farmland market can make a significant difference in the final result.

Working with experienced farmland brokers and auction professionals can help ensure the property reaches the right buyers and receives the attention it deserves.

Jason Smith
Broker & Auctioneer
515-537-6633
[email protected]

Our past auction results can be found here.