Recent Iowa Land Values Survey Insights & Factors Influencing Prices – September 2024

Oct 14, 2024

Farmland has long been the backbone of America’s agricultural industry, supporting crop production, livestock operations, and rural communities across the country. Its value extends beyond economics, deeply intertwined with the nation’s history and future growth. In 2021 and 2022, Iowa’s farmland market made headlines with record-breaking sales and skyrocketing land values. However, over the past 18 months, the market has begun to stabilize.

5% Decrease in Iowa Farmland Values:

The REALTORS® Land Institute – Iowa Chapter’s biannual Land Trends and Values Survey offers valuable insights into the current state of Iowa’s farmland market. Experts such as appraisers, realtors, auctioneers, farm managers, attorneys, and other professionals contribute to the survey, providing estimates of average farmland values as of September 1, 2024. These estimates focus specifically on bare, unimproved land sold on a cash basis.

According to the latest survey from the REALTORS® Land Institute, Iowa farmland values have declined by an average of 5.0% statewide between March and September 2024. This follows a 3.1% drop between September 2023 and March 2024, resulting in a total decrease of 8.31% over the past year for tillable acres. After the rapid rise in values during 2021 and 2022, the market has softened, with similar declines seen in pastureland (down 2.9%) and timberland (down 2.4%) over the past six months.

The results indicate that the market is moving away from the rapid growth of 2021 and 2022, entering a period of declining prices. This shift is largely due to the impact of high interest rates, lower commodity prices, and inflationary pressures.

Jason J Smith

Jason J Smith

Auctioneer & Land Broker

Jason is an experienced farmland broker and auctioneer with extensive experience in farmland sales across this Midwest.  Jason has worked with hundreds of clients to create advantageous outcomes.  If you are selling land schedule a consultation with Jason by calling or using the calendar.

Read Jason's Full Bio Here

Phone: 515-537-6633     Email: [email protected]

Value Variations Across Iowa Regions

While the overall decline in farmland values is notable, the impact varies across Iowa’s nine crop reporting districts. For example:

  • Northwest Iowa, traditionally a strong region for agricultural productivity, saw a 4.7% drop in value.
  • Southeast Iowa experienced a similar decline of 3.7%.
  • South Central Iowa faced the largest reduction at 6.0%, indicating localized market weaknesses

Factors Influencing the Market

Several key factors contribute to the current state of the Iowa farmland market:

  1. Commodity Prices: One key factor affecting farmland values is commodity prices, which have a substantial impact on farm revenue. When commodity prices rise, farmers experience increased cash flow, encouraging them to invest in additional land. On the other hand, lower commodity prices lead to reduced cash flow, often resulting in decreased land values. Recently, as commodity prices have dropped, farmland values have followed suit, with buyers adopting a more cautious approach.
  2. Interest Rates: The potential for future interest rate cuts may support market stabilization, but current higher rates are a limiting factor.
  3. Yields: Strong agricultural yields across much of Iowa may help offset some of the market softness.
  4. Inflation: General economic concerns and inflationary pressures have also played a role in making buyers more cautious

While non-farmer investors are frequently mentioned, they typically place only a few bids. It’s the farmers, dealing with liquidity challenges and shifting financial priorities, who dominate the market and make up the majority of top bidders on auction day.

What to Expect Moving Forward

As we head into 2025, the market’s trajectory will largely depend on a few key variables: interest rate movements, commodity price trends, and local demand within specific regions. While the recent downturn might seem concerning, many experts believe that Iowa’s farmland market will continue to offer good opportunities for both buyers and sellers, particularly in areas with strong yields and lower debt levels​.

For those looking to invest or sell farmland, staying informed about the latest trends in your specific region is critical. Engaging with a knowledgeable land professional who can provide detailed market insights will be crucial in making the most of these opportunities in a fluctuating market.

Future of Farmland Market:

Despite these variables and potential fluctuations, farmland continues to be a strong long-term investment. The consistent history of agricultural real estate delivering steady returns is clear. Farmland is distinctive, typically undergoing an ownership cycle of about 60 years. This rarity of sales presents opportunities for the right buyer to acquire valuable land, regardless of short-term market dynamics.

As the Iowa farmland market evolves in 2024 and 2025, it reflects the complex interplay of factors influencing land values. While the market may be cooling from the record-breaking trends of recent years, its lasting appeal and strong investment potential remain intact. If you are considering selling, now could be an ideal time to do so.

Contact us today to get started on the selling farmland journey. We offer a free consultation and ready to answer the questions you have. Schedule an appointment  here.

The REALTORS® Land Institute categorizes Iowa’s farmland prices based on quality. While there is no official classification for High, Medium, and Low-Quality Cropland, one could reasonably divide the Corn Suitability Rating (CSR) system into three tiers:

  • Low-Quality: CSR ratings from 0 to 33
  • Medium-Quality: CSR ratings from 34 to 66
  • High-Quality: CSR ratings of 67 and above

However, distinguishing between non-tillable pasture and timber can be challenging, as many pastures contain timber, and timbered areas often include open pastures. It’s uncommon for a farm to fit neatly into just one category.

If you’re looking to use these figures as a general guideline to understand your farm’s value in relation to its area, they can be helpful. For a more precise assessment, we recommend requesting a free customized land market analysis from DreamDirt.

Iowa Farmland Values Dollars Per Acre March – Sept 2024

Region High Quality Cropland (Sept 2024) High Quality Cropland (Mar 2024) Medium Quality Cropland (Sept 2024) Medium Quality Cropland (Mar 2024) Low Quality Cropland (Sept 2024) Low Quality Cropland (Mar 2024) Pasture (Sept 2024) Pasture (Mar 2024) Timber (Sept 2024) Timber (Mar 2024) % Change in Tillable Cropland
Central 14,443 15,168 10,875 11,502 7,668 8,153 4,296 4,410 4,256 4,322 -5
East Central 15,143 15,952 11,662 12,480 8,317 8,860 4,968 5,120 4,917 5,001 -6
North Central 13,841 14,218 10,763 11,231 7,536 7,891 4,400 4,555 4,026 4,082 -4
Northeast 14,322 15,115 11,678 12,272 8,430 9,099 4,825 4,982 4,839 5,029 -6
Northwest 15,587 16,162 12,351 13,071 8,685 9,178 4,875 5,001 4,221 4,299 -5
South Central 10,014 10,724 7,901 8,205 5,880 6,385 4,546 4,700 4,586 4,782 -6
Southeast 14,147 14,608 10,183 10,612 6,904 7,226 4,656 4,748 4,398 4,433 -4
Southwest 12,149 12,597 9,097 9,772 5,981 6,413 4,512 4,710 4,162 4,342 -5
West Central 14,631 15,213 11,236 11,804 8,307 8,940 4,696 4,800 4,445 4,550 -5
State 13,808 14,417 10,638 11,216 7,523 8,016 4,641 4,781 4,428 4,538 -5

Iowa Chapter of the Realtors Land Institute Value Survey March to September 2024

Twice a year, the Iowa Chapter of the REALTORS® Land Institute conducts a survey among its professional members to evaluate changes in farmland prices and estimate fluctuations since the last report. These reports are generally released in March and September, reflecting Iowa land prices from March to September 2024. It’s important to note that this “survey” does not provide actual sales results, and each participant may use different methods and hold diverse opinions in their responses. While the land value survey may not yield exact figures, it serves as a valuable tool for understanding market dynamics.

Below is the overall farmland values for the 9 crop reporting districts in Iowa with each showing a decrease in farm real estate values.  This is significant when you consider the substantial gains, we saw in 2021 and 2022.

We predicted last year that the record breaking sales would start to decline and the market would not be able to keep up with the soaring prices. We know where farmland prices are at now currently, don’t wait any longer. If you are considering selling a farm it really is time to act.  We offer free customized farmland valuations to help you understand a more precise value of your farm.

Jason Smith, Broker | Auctioneer

Jason Smith, Broker | Auctioneer

Founder, Farmland Auctioneer & Land Broker

Jason is a veteran farm real estate auctioneer with many awards and accolades.  He is among the top Farmland Auctioneers in the Midwest.  Licensed in Iowa, Minnesota, Nebraska and South Dakota.

Email: [email protected]Phone: 515-537-6633

Request a Farmland Market Analysis and Free Land Selling Consultation

Request a Free Valuation for Your Farm or Land Property

Whether you’re ready to start the selling process, or even remotely curious, we will gladly provide you with a FREE Market Analysis! If you are in a position to sell land in the Midwest, we want to help you achieve the top of the market on your sale.

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