Iowa Farmland Values UP 2% In 2017 – New ISU Survey

Every year in December we get one of the most significant reports on Iowa farmland values from Iowa State University.  After 3 straight years of decline, Iowa farmland values are up 2% in 2017 to $7326 per acre.  For those of us in the business of selling farmland, this isn’t a real surprise.  2017 has been a really good year to sell a good quality farm.  Farms of good quality or better have had stiff competition this year.

Iowa Farmland Prices

High-Quality Farmland was up 2.0% to $8933 an increase of $175 per acre.  Medium Quality Farmland was up 2.2% to $6,849 and Low-Quality Farmland was up 0.5% to $4,689 an increase of $24 from 2016.

Farmland sales in 2017 have definitely had a boost from low sales volume.  While it was a very busy year at DreamDirt many companies conducted far fewer auctions throughout the year than typical and sales volume statewide is 1/2 of what it was in 2012.  This low sales volume was not enough to satisfy demand around the state.  Iowa is a target for investors because many of our surrounding states have property tax rates which are much higher than Iowa and the quality of Iowa farmland and competitive rental market puts pressure on land sales that does not exist in surrounding states.

Reasonably low-interest rates have continued to play into farmland prices but we continue to see interest rates on the move which is a threat to farmland values.  At some point the market will begin to deduct value for interest payments and the seller will no longer benefit from the boost we currently see.  Those increased expenses will pull on land prices at some point with continued increases.

A few high points from the report include

• Land fell previous 3 years 8.9%, 3.9% and 5.9% First gain in 4 years.

•Lack of available land is driving this year’s increase in prices

• Stagnant farm income and increasing interest rates will put pressure on farmland prices in the future

• Only 4 counties reported lower land prices this year Fremont, Mills, Montgomery, and Page

• For the 5th year in a row, Scott County reported the highest land prices and Decatur reported the lowest land prices in Iowa.

• Dubuque County reported the largest dollar increase in value gaining $355 per acre

• Allamakee and Clayton Counties reported the largest percentage land value increase at 4.7%.

• Mills County had the highest decrease in value losing $25 per acre

• Of all 9 crop reporting districts in Iowa, only South Central Iowa reported a decrease in farmland values -1.6%

• The largest percentage increase in values by region was in East Central Iowa at 3.8% gain in farmland values

• The most positive factors influencing farmland prices was favorable interest rates, strong yields, and limited land supply.

Iowa Average Farmland Values 2017 County By County

The Iowa land values survey is not designed to help you identify the value of your farmland in Iowa but can give you an average for the area where you own a farm.  Your farm may be worth more or less and we can help you more accurately determine the potential value of your farmland.  Get a free custom market analysis for your farm today and learn what it will sell for by listing or auction.  Our Iowa Auctioneers are ready to help you achieve a top of market offer on your farmland.  Contact us today 855-376-3478