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2021 Land Prices - Forged in Farmland – Fueled with Emotion!

2021 Land Prices - Forged in Farmland – Fueled with Emotion!

2021 Land Prices - Forged in Farmland – Fueled with Emotion! I have sold all kinds of assets throughout my career, and I still say that “There is more emotion in farmland than any other asset I have ever sold!” Farmland did not back down in 2021 and will continue with forward momentum in 2022. Iowa saw a significant increase in the number of acres sold this past year. Farmland values saw multiple auctions that set record prices in many counties. We continue to see a demand from both farmers and investors. Farmers had a blessing of good crops and significant incomes that came from 2021. If I had a crystal ball, I would look forward and tell you what land prices, interest rates, and the price of corn will be in 2022. You all know that I don’t have that crystal ball and as such we hedge on facts and data. The fact is that in 2021 we as an agricultural community showed the rest of the farming world that we would pay increasingly more for farmland than we have in the past. A perfect storm of factors brought us to that point. One farmland fact I know is that they are not making any more farmland and everyone I know with farmland wants more! 2021 Farmland Facts! 140,981 acres sold at auction in 2021 1126 separate auctions were held in 2021 Average price per acre averaged $10,997/ acre across all the land that sold in 2021 Average of $149/CSR2 in 2021 Land with CSR2 above 75 – Averaged 12,869/ acre Land with CSR2 between 50-75 - Averaged $8759/ acre Land with CSR2 lower than 50 – Averaged $6,820/ acre 18 farms sold for more than$20,000/ acre Sioux County had the most auctions (46) and also had the highest average/ acre ($17,850/ac) The most acres were sold in November, followed by December then September Farmland can be sold any time of year with success Our Mission; Is to be your “Trusted Advisors”, Our obligation; is to market your farmland to the largest audience yielding you the most successful outcome! Call today to see what your farm is worth and get a free land valuation! David & Ann Whitaker | Iowa Land Guy When you think of Farmland Think of US! Read More

How Much Is My Farmland Worth

How Much Is My Farmland Worth

How much is my farmland worth? As a landowner, it is important to know how much your farmland is worth. If you are looking to sell your land in the near future. If you have no intention at all of selling. You should be able to answer the question: What’s my farm worth? How do you determine your land's value? Let’s start with the basics. What factors may affect your land valuation? You probably want to know more about your land, specifically. That’s understandable. The best way to get an accurate depiction of your farmland’s value is to have an   completed. When having an appraisal done, the appraiser will take a look at many factors and features of your land while evaluating and determining a price point. Here’s a quick overview of what an appraiser will look at before setting their official appraisal amount. The price of farmland is a moving target. We at Whitaker Marketing Group do our best to stay on top of the market conditions, and we watch the price of every land sale in Iowa very closely. There are many factors that go into a farm valuation. Location: Location is a big factor in valuing land. The neighboring farmers and how aggressive they are when it comes to buying your farm can play a big part in your final price. Farming ability, Shape: Farms that lay nice and are easy for the farmer to get their equipment in and out, help the farm bring more money. Time is money! Square, Flat, and Black soils help you bring more money when selling your farmland. Size: The size of the farm plays into the total dollars that the buyer is going to spend. Most often there are more potential bidders that can afford to bid on the smaller tracts of land, so they tend to bring a larger price point. Conversely, once your farm acres drop below 40, it becomes less conducive for the farming ability aspect and can lower the price. CSR, CSR2, Soil Type, Slope, Drainage: The CSR score in Iowa is a rating system that scores the productivity of your farmland from .5 on the bottom end to 100 being the best farm. Iowa State released CSR2 to the USDA NRCS this past fall and the NRCS completed a soil database update in December 2013 and published it in January 2014. The biggest difference between is the water-holding capability of the land. Other factors that affect what your CSR2 score is of course the Soil type, the slope, and Drainage. CSR stands for Corn Suitability Rating. Water sources, Hunting & fishing ability: Iowa is one of the best states for whitetail hunting, and as such some of our land sells to hunters that are looking for the next trophy. If you can show that you have a great hunting spot with lots of game this can also drive the price of your land. Since COVID in 2020 we have seen an increase in the value of . The Ability's to build a house, Zoning: If your land lies within the 20-mile radius of a larger town and has the ability to build a house. This can drastically increase the value of your farmland. There is a catch. Each county in Iowa has different requirements for building a house. Be sure to check and see if your farmland is buildable by the local . As a realtor, we talk about Highest and best use. If you are within that golden circle the highest and best use of your farmland may not be farming. What is Iowa Land Values doing statewide? It is helpful to start any search for the value of your farmland with a quick look at how land values are trending in the state of Iowa as a whole. For this, one of the most useful publicly available resources is the Farmland Value Survey produced throughout the year by Iowa State Extension and Outreach’s Ag Decision Maker publication. It gives a general land value estimate of per acre prices in counties in Iowa, trends in land value, geographical land price relationships and the factors that are positively or negatively affecting the land market across the entire state. We can also look at the Iowa Chapter . What factors are influencing the Farmland Market? In general, there are several factors that are always influencing the farmland market in one direction or another. These factors will also have some influence on the value of your land, too. Those factors include: What affects your land value? I always say Markets are an attitude. Farmland is worth what someone is willing to give. – Iowa farm real estate experts Want to know how much your farmland is worth? and get started by sharing a little bit of information about your farm. David Whitaker - The Land GuyRead More

Iowa Land Auction Prices, December 11-17, 2021

Iowa Land Auction Prices, December 11-17, 2021

Iowa Land Auction Prices, December 11-17, 2021 Sioux County gets top honors this week with six sales ranging from $20,100 to $25,100/acre. Honorable mention goes to Dallas County with a sale at $16,625/acre. Auction activity is winding down. There are only a few more auctions to finish out 2021, which will go down in history for the amount of land auctioned. Reminder - my land auction results newsletter provides facts about current land prices. This can be helpful to families discussing a loved one’s estate or trust that includes a family farm. You may download a current copy or subscribe to the monthly email at . “That’s my story and I’m sticking to it!” Jim “the Land Talker”Read More

Iowa Land Auction Prices, December 4-10, 2021

Iowa Land Auction Prices, December 4-10, 2021

Another week topping $20,000/acre. Lyon County takes highest honors with a sale at $20,500/acre. Delaware County gets honorable mention with a sale of 311.91 acres at $17,400/acre. We’ll have one more week of aggressive auction activity and then just a handful of auctions through the end of the month. If your family will be discussing a loved one’s estate or trust that includes a family farm, my land auction results newsletter can provide you with facts about current land prices. You may download this, or subscribe to the monthly email, here at  . “That’s my story and I’m sticking to it!” Jim “the Land Talker”Read More

More stable, better returns than the stock market

More stable, better returns than the stock market

5 reasons why farmland might be investors' best bet Investors looking for a financially sound long-term investment that is highly likely to generate returns should look no further than farmland. Plus, what’s better about farmland than many other types of assets, farmland can generate income for landowners in the meantime until they are at the point where they wish to sell. Farmland isn’t always an easy asset to get your hands on, though. For those who are not familiar with farming, it is not always easy to manage, either. However, it is fairly well known that owning farmland can be lucrative for the savvy investor who knows their way around agriculture or is able to partner with a farm management firm or a similar professional. So, if you are exploring investment options, then here are five reasons why farmland makes a good addition to any investment portfolio. 1. Farmland may be an opportunity you have never considered Maybe you have never thought of investing in farmland. If that is the case for you, then perhaps that is all the reason you need to look into it as an option. According to Forbes, the global farmland market is worth nearly  . It also has a history of providing investors with high returns and low volatility. That market in the U.S. alone is about $2.5 trillion. The value of land likely will continue to increase, too, as the world population is set to only increase. This will drive the demand for the food produced from land higher, taking land values up with it in most cases. 2. Farmland fits in any investment portfolio Take any investor’s portfolio and we can assure you that there is room for farmland. It goes well with just about any portfolio and plan. A couple of the reasons why is that it is not as susceptible to inflation and its ups and downs run opposite to other types of conventional equity investments, according to  . 3. Tax exemptions and government assistance There are some   to owning and investing in farmland that you may not know about. Did you know that income from land that is used for farming is exempt from the wealth tax? That’s a clear benefit of owning farmland for investors who either farm the land themselves or have entered into an agreement with a tenant farmer to farm the land and charge rent or share revenue in one way or another. On top of that, mortgage interest can be deducted from your taxes, too. Plus, if that wasn’t enough, there are also plenty of government grants that are available if you are looking to do the farming or livestock raising yourself. These opportunities are certainly worth looking into if you are familiar with farming. 4. More stable, better returns than the stock market Most investors are familiar with the stock market. It is, after all, where most people invest their money. But investing in agriculture and land may be a better deal, as farmland is often   than the stock market. With land, value only appreciates over time. The same cannot be said for stocks. Returns from land also outpace returns from stock. According to Harvest Returns, the   on farmland has averaged 11.5% over the last 25 years. Stocks, on the other hand, may get a 6-7% return, but even that’s if you sit tight with those for the long-term. Again, that comparison is on average and the return may not be totally consistent from year to year. And, as with all types of investment, there are various risks to weigh, so it’s best to speak with a financial advisor. 5. More social impact from investing in land There is a lot to be said of the very real   of investing in farmland. It’s about more than the finances for many in farming. For one, an investment in farming can keep farmers farming. The surrounding community also benefits from jobs both directly and indirectly related to agriculture. Putting that land to good use can also help provide food and energy for customers around the world. Put another way, investing in farming can be seen as investing in communities both local and global. It provides tangible benefits for both. How to get started investing in land Getting your foot in the door of the farmland investment market can be tricky for the experienced investor and perhaps a little daunting for those that are not familiar with agriculture or do not have a farming background. Still, with the right advisors behind you, land can be acquired and added to your investment portfolio in a number of ways. There are many new platforms and programs out there that make investing in farmland easier than it has ever been, but one of the ways to benefit from farmland as an investment and as a source of income is to buy the land directly. That’s when you locate good land that can be used to produce crops or raise livestock. From there, if you are not going to farm the land yourself, you find a tenant farmer or rancher. Buying land directly does have a significant cost at the onset, but the income from either rent or revenue sharing, depending on your lease agreement with that tenant, can prove very fruitful for all parties involved. Whitaker Marketing Group can help investors Getting started in land investment or growing an existing investment portfolio is not easy and should not be rushed. So, no matter your situation, it’s critical that you find a trusted consultant or farm management services provider who can provide you with the proper information and guide you along the way toward achieving your goals. That’s where Whitaker Marketing Group can help. Our team will represent you in a professional manner in all areas concerning your farmland investment, including planning, accounting of farm income and expenses, contract and lease negotiations, soil stewardship, crop insurance and so much more. Let’s work together on achieving your goals.   today.Read More

2021 Iowa State University Land Value Survey

2021 Iowa State University Land Value Survey

Iowa State University Land Survey Show a 29% increase statewide. History of the Iowa State Farmland Survey The survey is an expert opinion survey based on reports by licensed real estate brokers, farm managers, appraisers, agricultural lenders, county assessors, and selected individuals considered to be knowledgeable of land market conditions. Respondents were asked to report for more than one county if they were knowledgeable about the land markets. The 2021 ISU Land Value Survey is based on 645 usable county-level land value estimates provided by 455 agricultural professionals. Of the 455 respondents, 75% completed the survey online. Online responses allow participants to provide estimates for up to 16 counties. A web portal has been developed to facilitate the visualization and analysis of Iowa farmland values by pooling data from ISU, USDA, Federal Reserve Bank of Chicago, and the REALTORS® Land Institute Iowa Chapter, as well as by making use of charts over time and interactive county maps. The portal can be accessed at . Iowa Farmland Value Increase The 2021 state average for all quality of land was estimated to be $9,751 per acre as of November 1, 2021. The statewide average value increased $2,193 per acre from November 2020. The statewide average value increased 29.0% from November 2020 Major Factors Influencing the Farmland Market Most survey respondents listed positive and/or negative factors influencing the land 4 market. Of all respondents, 94% listed at least one positive factor, and 65% listed at least one negative factor. In most cases, respondents listed multiple factors. There were two positive factors listed by over 10% of respondents who provided at least one positive factor. The most frequently mentioned factor was higher commodity prices, mentioned by 28.5% of respondents. Favorable interest rates and strong yields were the second- and third-most frequently mentioned positive factors, mentioned by 24.4% and 7.4% of respondents, respectively. Other frequently mentioned positive factors included limited land supply (7%), strong demand, including from investors (6.8%), COVID-related government payments (6.3%), and good farm economy (4%). There were also two negative factors listed by more than 10% of respondents who identified at least one negative factor. The most frequently mentioned negative factor affecting land values was higher input costs, mentioned by 20% of respondents. Concerns about the sustainability of high land prices and possible changes in interest rates were the second- and third-most frequently mentioned negative factors, mentioned by 12% and 8.5% of respondents, respectively. Political uncertainty related to policies, such as tax law changes, and uncertainty related to COVID-19 were each mentioned by 5%–9% of respondents. Who is buying Farmland? The 2021 survey asked respondents what percent of land was bought from five 5 categories of sellers: active farmers, retired farmers, estate sales, investors, or other. The majority of farmland sales, 54%, were from estate sales, followed by retired farmers at 24%. Active farmers accounted for 9% of sales, while investors accounted for 10%. Estate sales by crop reporting district ranged from 66% in the Northwest district to 43% in the Southwest district. Sales by investors were highest in the South Central district (18%). The West Central district reported the lowest investor sale activity (5%). Source Read More

Iowa Farmland Market - Update November 2021

Iowa Farmland Market - Update November 2021

Iowa Farmland Market Update! Iowa Farmland Prices. The perfect storm! What is driving Farmland? The last 12 months we have seen farmland prices increase quickly. It is not just one thing that is driving the market. It is a multitude of things all combined. First, we had Covid and farmers were granted MFP payments. Then came PPP payments. China was recovering from a swine flu and had requested to buy larger amounts of our corn and bean crops than previous years. We then had an administration change that made people fearful of proposed changes to the way we do business when it comes to transferring farmland from one person to the next. Commodity prices increased and we started to see land prices rise. January to April we sold less farmland than we did in 2020 which created a lower supply issue. Interest rates are historically lower than ever. All combined, these factors have drove farmland up 26.6% year over year. Since May we have sold more acres every month than we did in 2020 (48% more acres). Will land prices continue to stay strong? Is this the new normal? Since I have been alive the price of bread, vehicles, and houses have all increased and they have not gone back down to where they were in my younger days. I feel that farmland will have its ups and downs on a micro level, but I don’t see the price of farmland moving in the downward direction. I do feel that we will see the amount of auctions and acres decrease in time with continued demand for the best investment on earth. “Farmland” Results from the 158 Sales (17,902 acres) this last month have the average for the state at $11,107 high quality ground at $13,552/ acre, and medium quality ground averaging $8,772/ acre. Low quality ground has moved up at an average of $6,345/ acre. Our Mission; Is to be your “Trusted Advisors”, Our obligation; is to market your farmland to the largest audience yielding you the most successful outcome! Call today to see what your farm is worth and get a free land valuation! David & Ann Whitaker | Iowa Land Guy When you think of Farmland Think of US! Read More

Iowa Farmland Market - Update October 2021

Iowa Farmland Market - Update October 2021

Farmland Market Update! Iowa Farmland Prices. Hotter than a $2 dollar pistol! Land is on the move. There is an incredible amount of land that is changing hands. Generically speaking If you look at the age of the landowner in Iowa over the next 10 years, there will be 1000 acres per county that will change hands. Many people are wanting to sell with the possibility of changes in the tax law. Congress keeps moving the target but as of right now it looks like they will not get rid of stepped-up basis, or 1031. It is still being negotiated but, right now it looks like they are talking about a 5% rise in the federal capital gains. It was said to me last week that all farmland that is being purchased is being subsidized by something else. Another job, other paid off farmland, PPP, MFP, inheritance, old money, and people moving other investments into farmland. I have younger farmers say, “there is no way they can make that cashflow”. They would be correct. To buy farmland in this market you will need to subsidize it with something. That being said, I don’t see us slowing down or the market changing so drastically that farmland will cashflow based off the merit of the crop for a new farmer. The Realtor Land Institute just published their survey that would align with all our numbers. They showed a 18% rise in farmland in the last 6 months and a 26.6% rise year over year. Results from the 167 Sales (18,355 acres) this last month have the average for the state at $10,809 high quality ground at $12,446/ acre, and medium quality ground averaging $8,479/ acre. Low quality ground has moved up at an average of $5,978/ acre. Our Mission; Is to be your “Trusted Advisors”, Our obligation; is to market your farmland to the largest audience yielding you the most successful outcome! Call today to see what your farm is worth and get a free land valuation! David & Ann Whitaker | Iowa Land Guy When you think of Farmland Think of US! Read More

Iowa Farmland Market Update - December 2021

Iowa Farmland Market Update - December 2021

Iowa Farmland Market Update! Current Farmland Prices Statistically the most acres move in November and this November did not disappoint! Talking with realtor and land professionals, I am hearing resounding echoes that the market is going to stay strong. Discussing futures with some economists they would indicate that we are setting ourselves up for a repeat of the 1980’s. This is not anything any of us want to hear! They are advising to get your houses in order and secure the low interest rates to prepare for the coming years. None of us have a crystal ball that would tell us the future but, I can tell you that the price of farmland has moved up quickly and I have not seen any signs of it going back down. Looking at what has moved forward in the government, it looks like we will be keeping stepped up basis, they will not be taking our 1031, our capital gains rate will stay very similar, and being this is an election year I don’t think they will change much. This is positive news for farmers in Iowa. Results from the 293 Sales (31,813 acres) this last month have the average for the state at $11,688 high quality ground at $13,114/ acre, and medium quality ground averaging $9,597/ acre. Low quality ground has moved up at an average of $6,539/ acre. Our Mission; Is to be your “Trusted Advisors”, Our obligation; is to market your farmland to the largest audience yielding you the most successful outcome! Call today to see what your farm is worth and get a free land valuation! From all of us here at Whitaker Marketing Group, we wish you all the best this holiday season! Merry Christmas and Have A Happy New Year!!! David & Ann Whitaker | Iowa Land Guy When you think of Farmland Think of US! Read More