Iowa farmland value up record 32.5 percent
By Jean Caspers-Simmet
simmet@agrinews.com
Date Modified: 01/04/2012 8:51 AM
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AMES, Iowa — Iowa farmland values soared 32.5 percent in the past year, according to the results of the Iowa Land Value Survey conducted in November. Average Iowa farmland value is estimated to be $6,708 per acre. Survey results were released at a press conference last week in Ames.
"The 2011 land value survey covers one of the most remarkable years in Iowa land value history," said Mike Duffy, Iowa State University economics professor and Extension farm management specialist, who conducts the survey. "This is the highest percentage increase recorded by the survey, and the average land value of $6,708 per acre, when adjusted for inflation, is at an all-time high. The previous inflation adjusted high was in 1979."
Scott County, with an estimated $9,223 average value for all farmland, saw the highest percentage increase and highest increase in value, 37.7 percent and $2,524 respectively. O'Brien County's farmland estimates of $9,513 were the highest average county values recorded by the survey. O'Brien's value was up 33.1 percent. Sioux County was second highest with farmland values of $9,419, up 35.37 percent. The Northwest Crop Reporting District, which includes O'Brien and Sioux counties, reported the highest land values at $8,338, an increase of $1,983, or 31.2 percent from 2010.
The North Central Crop Reporting District showed land values of $7,356, up 28 percent. Land values were $6,602 per acre in the Northeast Crop Reporting District, up 31.5 percent.
Decatur County had the lowest reported land value, $2,721 per acre, and the lowest dollar increase, $636. Washington County had the lowest percentage increase, 28.2 percent, with a reported $7,166 average value.
Commodity prices was the most frequently mentioned positive factor influencing the land market, Duffy said. The second most mentioned factor was low interest rates. Land is a good investment and favorable yields tied for third. A favorable agricultural economy and availability of borrowed or equity capital were other factors listed as favorable.
The most frequently mentioned negative factor was that values are too high. High input costs and a poor world economy were also listed as negatives.
The increase shown in the ISU survey matches results of other recent surveys of farmland value — the Chicago Federal Reserve Bank's estimated a 31 percent increase in Iowa land values and the Iowa Chapter of the Realtors Land Institute's 12.9 percent increase estimated for six months of 2011, Duffy said. The 2011 values are historical peaks.
Low grade land in the state averaged $4,257 per acre and showed a 26.8 percent increase, while medium grade land averaged $6,256; high grade land averaged $8,198.
Of districts, the lowest land value and smallest percentage increase were estimated in the South Central Crop Reporting District, $3,407 and 26.7 percent respectively. The Southwest Crop Reporting District reported a 36.5 percent increase, the highest district percentage.
Maps showing 2011 values, percentage change and comparisons to 2010 data and additional information from Duffy are available at www.extension.iastate.edu/topic/landvalue.