Factors Influencing Farmland Prices

From Successful Farming: 

Headlines boasting record-breaking farmland sales and surging values gave voice to the excitement in the market last year while land prices climbed. As 2023 marches on, the experts say some of that excitement may be waning and to expect strong, but flatter prices going forward.

                                                       PHOTO: KATIV, GETTY IMAGES

“We’ll probably see some high reports of really high-quality farms that are well-located…and we might see some lower-quality farms start to back up a little bit in prices as we head toward the end of the year,” says Tim Koch, executive vice president of business development for Farm Credit Services of America. “But as a whole, I would anticipate that we’ll see a flattening of prices throughout the remainder of the year.”

Jackson Takach, chief economist at Farmer Mac, put it this way: “You’re still seeing positive gains in land values, quarter over quarter, but at a much-reduced rate compared to ’21 or ’22, when they were in the double digits of annual and quarterly growth. Today they’re in the 1% to 3% range.”