"Where Fillmore County News Comes First"
Online Edition
Tuesday, June 18th, 2013
Volume ∞ Issue ∞
- 7:10:46, Jun 13th 2013 - chipperlee - Seems to be a well written article, except maybe Silica Sand is used in ... [Read More]
- 12:02:15, Jun 9th 2013 - getthefacts - The problem here lies in the fact that girls were repeatedly told "if y ... [Read More]
- 10:45:32, Jun 7th 2013 - Jo mom for 6yrs - Mr. Ehler hit the nail on the head. I agree with the religious con ... [Read More]
- 2:47:58, Jun 7th 2013 - hello - Hello, it's time you wake up. There isn't a community nearby that doesn't offe ... [Read More]
- 9:06:21, Jun 6th 2013 - hello - Hello, it's time you wake up. There isn't a community nearby that doesn't offe ... [Read More]
- 2:05:29, Jun 6th 2013 - Kim Wentworth - The number one rule in a debate: 1) if the person from the opposite si ... [Read More]
- 12:42:18, Jun 4th 2013 - EW - For someone that is always spouting religious rhetoric, you try to come off as a ... [Read More]
- 11:32:18, May 31st 2013 - JO PLAYER - This is unfair to us girls. Morrie Miller is not getting canceled but J ... [Read More]
- 8:25:34, May 29th 2013 - RP - Why is Mr. Ehler involving himself with non-school activities? Is he going after ... [Read More]
- 6:40:49, May 29th 2013 - Doc - You are a cartoon character! If I see you in person I will burst out laughing. ... [Read More]
Farmland sales rush could spell short supply on higher values in 2013
Fri, Jan 25th, 2013
Posted in All Agriculture
Posted in All Agriculture
Comments
OMAHA, Neb. – Economic uncertainty had some non-operating farmland owners rushing to sell, which was evident in the last three months of the year, according to Farmers National Company, the largest farmland and ranchland real estate company in the country. Overall for 2012, Farmers National Company reports that sales activity was up 40 percent over 2011.
“We anticipated another record year in 2012, but what we’ve seen has exceeded our expectations,” said Derrick Volchoff, ALC, vice president of real estate operations at Farmers National Company.
Projected changes in tax laws prompted many landowners who were planning to sell in the next two years to act before new rules take effect. This high level of activity is likely to lead to a short supply of available land as we enter 2013, according to Volchoff, which could drive values even higher.
“Pure economics should dictate that values rise if the supply of available land tightens,” said Volchoff.
The fact that values have stayed strong over the past few years has prompted landowners to sell while the market remains positive. Several market forces such as economic uncertainty in Europe and China, as well as the widespread drought, have not negatively impacted land values to date.
Buyers in the current market are farmers looking to expand their operations, said Volchoff. Non-operating land owners are driving activity, as many sellers are looking to sell inherited or transferred land. High profitability from strong commodity prices in recent years has put many farmers in a strong cash position, reducing purchase risk as debt ratios have been held down. Very few investors are looking to sell at this point.
“Buyers feel they will still get returns on land well into 2013 as projections for continued profitability are strong,” said Volchoff. “Farm operators feel very comfortable in their situations. They have significant cash and are investing it in their operations buying land and equipment.”
The future of the market, while unforeseen, is not risky, according to Volchoff. “The farmland market has not been highly leveraged, as residential housing markets were when prices skyrocketed. This is not a speculative market and we do not foresee any type of abrupt downturn. People still see land as a safe, tangible investment and are willing to keep their money there over the long term.”
Farmers National Company, an employee-owned company, is the nation’s leading agricultural real estate and farm and ranch management company. The company has sold over 3,500 farms and more than $2.0 billion of real estate during the last five years. Farmers National Company currently manages more than 4,700 farms in 24 states. Additional services provided by the company include auctions, appraisals, insurance, consultation services, oil and gas management, lake management and a national hunting lease program. For more information on land listings in your region, visit the Farmers National Company website at www.FarmersNational.com.
REGIONAL LAND VALUE REPORTS
Iowa and Minnesota
Demand for quality land continues to be very strong in the North Central Region including Iowa, Missouri, Minnesota and South Dakota, according to Sam Kain, area sales manager for Farmers National Company in Iowa and Minnesota. Auction numbers in this region were up in 2012, prompting sellers to net top sales prices.
“Farmers National Company completed more than 175 auctions in this region during 2012, which is up 35 percent over the prior year,” said Kain. “Demand is still outpacing the number of properties available, and quality is definitely king.” Despite higher cash rents and input costs narrowing farmer profits, the majority of buyers in the North Central Region continue to be farmers. In Iowa, top quality land is selling at more than $12,500 per acre, Minnesota values are reaching $9,500 per acre, and values in eastern South Dakota have reached $8,000 plus in many areas.
“Average land values are in the range of $3,500 to $6,000, with marginal land values in the $1,500 to $3,500 range,” said Longtin.
“We anticipated another record year in 2012, but what we’ve seen has exceeded our expectations,” said Derrick Volchoff, ALC, vice president of real estate operations at Farmers National Company.
Projected changes in tax laws prompted many landowners who were planning to sell in the next two years to act before new rules take effect. This high level of activity is likely to lead to a short supply of available land as we enter 2013, according to Volchoff, which could drive values even higher.
“Pure economics should dictate that values rise if the supply of available land tightens,” said Volchoff.
The fact that values have stayed strong over the past few years has prompted landowners to sell while the market remains positive. Several market forces such as economic uncertainty in Europe and China, as well as the widespread drought, have not negatively impacted land values to date.
Buyers in the current market are farmers looking to expand their operations, said Volchoff. Non-operating land owners are driving activity, as many sellers are looking to sell inherited or transferred land. High profitability from strong commodity prices in recent years has put many farmers in a strong cash position, reducing purchase risk as debt ratios have been held down. Very few investors are looking to sell at this point.
“Buyers feel they will still get returns on land well into 2013 as projections for continued profitability are strong,” said Volchoff. “Farm operators feel very comfortable in their situations. They have significant cash and are investing it in their operations buying land and equipment.”
The future of the market, while unforeseen, is not risky, according to Volchoff. “The farmland market has not been highly leveraged, as residential housing markets were when prices skyrocketed. This is not a speculative market and we do not foresee any type of abrupt downturn. People still see land as a safe, tangible investment and are willing to keep their money there over the long term.”
Farmers National Company, an employee-owned company, is the nation’s leading agricultural real estate and farm and ranch management company. The company has sold over 3,500 farms and more than $2.0 billion of real estate during the last five years. Farmers National Company currently manages more than 4,700 farms in 24 states. Additional services provided by the company include auctions, appraisals, insurance, consultation services, oil and gas management, lake management and a national hunting lease program. For more information on land listings in your region, visit the Farmers National Company website at www.FarmersNational.com.
REGIONAL LAND VALUE REPORTS
Iowa and Minnesota
Demand for quality land continues to be very strong in the North Central Region including Iowa, Missouri, Minnesota and South Dakota, according to Sam Kain, area sales manager for Farmers National Company in Iowa and Minnesota. Auction numbers in this region were up in 2012, prompting sellers to net top sales prices.
“Farmers National Company completed more than 175 auctions in this region during 2012, which is up 35 percent over the prior year,” said Kain. “Demand is still outpacing the number of properties available, and quality is definitely king.” Despite higher cash rents and input costs narrowing farmer profits, the majority of buyers in the North Central Region continue to be farmers. In Iowa, top quality land is selling at more than $12,500 per acre, Minnesota values are reaching $9,500 per acre, and values in eastern South Dakota have reached $8,000 plus in many areas.
“Average land values are in the range of $3,500 to $6,000, with marginal land values in the $1,500 to $3,500 range,” said Longtin.
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