Unlocking the Value of Minnesota Farmland: A Comprehensive Guide to Current Land Prices and Expert Insights - July 2024 Report

Welcome to Our Monthly Minnesota Farmland Value Report

In this monthly report, Jason Smith, Land Broker and Auctioneer dives into Minnesota farmland values, helping you understand the factors that determine what your farm is potentially worth. Our goal as auctioneers and farmland real estate agents is to provide you with up-to-date information, recent sales data, expert insights, and tips for maximizing the potential value of your farmland sale. Let us answer the questions you have about selling farmland in Minnesota. Contact us today for a free consultation.

Understanding Minnesota Farmland Values:

Factors Influencing Farmland Values in Minnesota

Minnesota’s agricultural landscape is influenced by a multitude of factors. In this blog, we will explore how commodity prices, interest rates, government policies, and regional conditions impact the current market values.

Recent Farmland Sales Data

Let’s dive into the latest sales data, including county location, land size by acre amount, soil productivity ratings, and sale prices per acre and total price in the table below. By analyzing this data, you can get a clearer picture of how your property may be valued in the current market.

Average Price of Farmland in Minnesota

• In the month of July, a total of 1016  acres were sold in Minnesota by the auction or private listing method.

• The current average per acre price for land in Minnesota according to these July sales is $6507/acre.

• The highest selling farm in Minnesota in the month of July 2024 sold on June 11th in Jackson County for $2,394,000 or $7600 per acre for 315 acres, with a CPI of 69.7.

• The farm with the highest selling price per acre for the month sold on July 11th for $10,900 per acre for 38.61 acres, with a CPI of 73.8 in Lac qui Parle MN.

Call us about selling your Minnesota land at (218) 297-5779. We can help you safely transition your land ownership using a private sale, public auction or even a private land auction.

July 2024 Rural Mainstreet Index Survey Results at a Glance:

• The July RMI for Minnesota rose to 50.7 from 50.2 in June. Minnesota’s farmland price index climbed to 53.7 from 51.5 in June. The new hiring index for July decreased to 52.1 from 55.3 in June. According to trade data from the International Trade Association, exports of agriculture goods and livestock for 2024 year-to-date were down by $73.3 million, or 14.0%, from the same period in 2023.

Why Today is a Great Time to Sell Farmland in Minnesota

As economic conditions shift across rural America, now might be the perfect time to consider selling your farmland in Minnesota. The latest data from the Rural Mainstreet Index (RMI) paints a complex picture, but for savvy landowners, it presents a unique opportunity. Here’s why today is a great time to sell.

1. Farmland Prices Are Rising Again

After a brief dip below growth neutral, farmland prices in the region, including Minnesota, have rebounded above the threshold. The farmland price index for July climbed to 52.2, up from June’s 49.9. This resurgence, though modest, indicates a window of opportunity for landowners looking to capitalize on current market conditions. However, it’s important to note that only 8.7% of bank CEOs reported that farmland prices expanded from June levels. With bankers projecting a 3.4% decline in farmland prices over the next 12 months, selling now could help you secure the best possible price before a potential downturn.

2. Declining Confidence in the Rural Economy

Rural bankers are increasingly pessimistic about the economic outlook for their areas. The July confidence index dropped to 28.3, its lowest level in 2024, reflecting concerns over weak agricultural commodity prices, reduced farm exports, and a downturn in farm equipment sales. This lack of confidence suggests that the economic environment may become more challenging in the near future, making now an opportune moment to sell before conditions worsen.

3. Weakening Agricultural Market

The overall Rural Mainstreet Index (RMI) has remained below growth neutral for 11 consecutive months, with July’s reading sinking to 41.3, the lowest since November 2023. This persistent weakness is driven by several factors, including declining farm exports and sinking agriculture equipment sales. The International Trade Association reports that regional exports of agricultural goods and livestock for 2024 are down $198 million, or 3.6%, compared to the same period in 2023. With the agricultural market under pressure, selling your farmland now could help you avoid the risks associated with further market declines.

4. Challenges in Farm Equipment Sales

Farm equipment sales have plummeted, with the index for July dropping to 19.0, the lowest in more than seven years. This decline marks the 12th consecutive month that the index has fallen below growth neutral. Higher borrowing costs, tighter credit conditions, and weak grain prices are contributing to this downturn, which in turn affects the overall profitability and sustainability of farming operations. For landowners, this trend underscores the potential for reduced demand for farmland in the future, making today an advantageous time to sell.

5. Potential Economic Recession

Over half of the rural bankers surveyed indicated that a recession is the greatest economic risk for the region over the next 12 months. With high consumer debt, elevated interest rates, and weaker farm income already cutting into retail sales, the broader economic outlook is uncertain. This uncertainty adds another layer of risk for landowners who might face declining land values and reduced buyer interest in the near future.

Conclusion

Given the current economic indicators, today’s market conditions present a unique opportunity for Minnesota farmland owners. Rising farmland prices, coupled with declining confidence in the rural economy and challenges in the agricultural market, suggest that now might be the best time to sell. By acting quickly, you can take advantage of favorable prices before a potential downturn in the market.

If you’re considering selling your farmland, it’s crucial to consult with real estate professionals who specialize in agricultural properties to ensure you get the best possible outcome. With the right strategy, you can make the most of this opportune moment and secure a strong financial future and DreamDirt can assist you in achieving your goals.

Navigating the Selling Process:

Tips for Selling Your Farm in Minnesota

Explore a set of practical tips for successfully selling your farmland by downloading our free eBooks here. Schedule a non obligatory consultation with us today and we will cover everything from when is the best time to sell, a customized marketing plan, sales methods, how we can help you find the right buyer, and answer your questions.

Farm Real Estate Experts in Minnesota

Meet our team of Minnesota farm real estate and auction experts who can provide you with valuable guidance and personalized assistance throughout the selling process. If you’re looking to uncover the true value of your Minnesota farm or are considering selling, don’t hesitate to reach out to our experienced team. We’re here to provide you with a customized plan to meet your goals. Contact us today to get started.

Assessing Your Farm’s Worth:

Minnesota Land Market Analysis Appraisal Technique

Curious what your farm could sell for? We prepare market analysis for each of our farmland sellers to help you discover and learn what your farm is worth from our market based research and expertise. Fill out our form here to request a market analysis of your Minnesota farmland or call us at 507-769-0128.