Iowa farmland values increased 29% statewide in 2021.
History of the Iowa State Farmland Survey
The Iowa State Farmland Survey relies on expert opinions from licensed real estate brokers, farm managers, appraisers, agricultural lenders, and county assessors. These professionals actively work in Iowa land markets and provide direct insight into local conditions.
In addition, respondents may report data for more than one county when they have market knowledge. For 2021, the ISU Land Value Survey included 645 usable county-level estimates submitted by 455 agricultural professionals.
Moreover, 75% of participants completed the survey online. Because of this format, respondents could submit estimates for up to 16 counties.
To further improve analysis, Iowa State University developed a public data portal. This tool combines information from ISU, USDA, the Federal Reserve Bank of Chicago, and the REALTORS® Land Institute Iowa Chapter.
As a result, users can explore interactive county maps and long-term charts through the Iowa State University Center for Agricultural and Rural Development (CARD).
Iowa Farmland Value Increase in 2021
As of November 1, 2021, the statewide average value for all qualities of Iowa farmland was estimated at $9,751 per acre.
This represented an increase of $2,193 per acre from November 2020. Overall, Iowa farmland values rose 29.0% year over year, marking one of the strongest annual gains on record.
Major Factors Influencing the Farmland Market
Survey respondents identified both positive and negative factors influencing the Iowa farmland market. Overall, 94% of respondents listed at least one positive factor, while 65% listed at least one negative factor. Most respondents cited multiple influences.
Higher commodity prices were the most frequently mentioned positive factor, noted by 28.5% of respondents. Favorable interest rates followed at 24.4%, with strong crop yields mentioned by 7.4%.
Additional positive influences included limited land supply (7%), strong investor demand (6.8%), COVID-related government payments (6.3%), and a generally strong farm economy (4%).
On the negative side, higher input costs were the most commonly cited concern, mentioned by 20% of respondents. Concerns about the sustainability of high land prices (12%) and potential interest rate changes (8.5%) also affected sentiment.
Political uncertainty related to tax policy and broader COVID-19 concerns were each cited by 5% to 9% of respondents.
Who Is Buying Iowa Farmland?
The 2021 survey asked respondents to estimate what percentage of farmland sales involved five seller categories: active farmers, retired farmers, estate sales, investors, and other sellers.
Estate sales accounted for the majority of transactions at 54%, followed by retired farmers at 24%. Active farmers represented 9% of sales, while investors accounted for 10%.
Estate sale activity varied by crop reporting district, ranging from 66% of sales in the Northwest district to 43% in the Southwest district. Investor purchases were highest in the South Central district at 18%. The West Central district reported the lowest investor activity at 5%.
Source:Iowa State University
