Falling farm land prices

[jmc]

Interesting article in the Wall Street Journal about how farm land skyrocketed and now is falling, due to falling crop prices. I always wondered about people paying $10K/acre when, say, political support for ethanol could end in a heartbeat. They also discuss how land prices ripple thru the entire farm industry.

To avoid the WSJ subscription requirement, Google this title, pick the WSJ link and they let you in:

Falling Property Values Hint at Trouble on the Farm

 

[Beltman60]

a local nursery bought 48 acres around the corner from my dad and paid $11000. / acre last fall
I couldn't believe it :mur:
my dads 42 acres backs up to the nursery's main property
this is in SW Ohio

 

[MH8675309]

Last year we had $6,000 to $10,000 an acre on larger parcels (100 acres and up) here in Michigan's thumb. It's considered Saginaw valley dirt and it's some of the best there is. And that would be tiled.

 

[Wakey]

In metro Atlanta the housing boom is heating up again as inventory has dwindled.

Developers knock on the door offering $100K an acre, I'm sure they are willing to pay substantially more.

Obviously this has nothing to do with farming, more to do with bulldozers and McMansions.

 

[Gary Fowler]

5 years ago we paid $2250 per acre for a 42 acre tract. A couple of month ago, my daughter in law paid $5500 ($7000 per acre asking price)per acre for a 10 acre adjoining tract. A developer has about 100 acres just down the road from us that he has sub-divided into mostly 3 acre sites with a couple of 5 acre tracts for $9000 per acre. He has put in gravel roads and water lines with fire hydrants( assume that this could be tied into for water to homes but no electricity is there yet and each home would have to put in their own septic systems. He is selling those tracts pretty fast but so far no one has started building.
Another developer not far from me sectioned off his farm into 10 acre tracts, with a dirt road (make that a path) to each site and he sold almost all of them and all have houses on them now. Unfortunately I have no idea on the cost of each parcel.

Much of the land around me is no longer farmed or ranched but is slowly turning into housing developments or mini-ranches as more and more folks want to get out of restrictive sub-divisions and get a piece of land on which they can grow a crop, animals etc. without some HOA telling them what they can keep, what color to paint their house, where and what kind of fence they can put up, where they can park a car or boat, when to mow their yard and what flowers they can put in, etc. I lived in one of those and I much prefer the farm life where I am now, no restrictions at all and I can build what I want, grow what I want, etc.
The demand for these types of places is what is pushing up the price of land for farm land also. This may not be happening in all areas but anyplace that is close to a metropolitan area is subject to bedroom community developments. Retiring farmers who no longer need their acreage or who can no longer afford to farm it are making a killing selling off parcels to would be mini-ranch owners or to developers who then make a fortune doing so.

 

[NoTrespassing]

Interesting article in the Wall Street Journal about how farm land skyrocketed and now is falling, due to falling crop prices. I always wondered about people paying $10K/acre when, say, political support for ethanol could end in a heartbeat. They also discuss how land prices ripple thru the entire farm industry.

To avoid the WSJ subscription requirement, Google this title, pick the WSJ link and they let you in:

Falling Property Values Hint at Trouble on the Farm

There's farmland here in east central Illinois in the paper, 40 acres/$13,000 per, and 30 acres/$12,000 per.

Kevin

 

[kenmac]

I'm currently looking at 50 ac mixed woods/pasture listed @ $2200.00 per ac with older home with septic tank, water, power. Property also has a trailer on it with the same utilities

 

[sixdogs]

Having lived long enough and owned farmland and property for most of that time I can say that my experience is to buy the best farmland you can afford for the best price you can get it for. Buying sub-par or bargain basement land is often priced low because of what it has to offer compared with the more fertile and better located property.

When prices fall the less desirable land usually has fewer buyers and therefore lower prices. When the good stuff falls in price, the value may be down but there always seems to be buyers looking to own it and the price seems to hold up better. Just my free advice here.