Land prices in the month of November 2019 trended down for new sales overall. We had a high number of successful closings from the previous 60 days that were higher than the overall new contract prices for new sales in the month of November. Some of the factors that affect land prices up and down were an interest rate decline, extremely wet harvest season, commodity market overall low, hunting season, or unstable rut activity.
The whitetail rut this year was very aggressive in some areas and seemed to be non-existent in others which was surprising due to the overall cold Midwest weather. Land prices traditionally were down in November due to the harvest being busy. However, we did see an increase of interest in hunting land, especially in whitetail properties during the middle of October through the end of the year. Hunting land annually has the most interest when people most enjoy their time in the outdoors. This time in the Midwest is during the late spring when it dries up and early fall before it gets too cold. When a buyer or current owner of hunting land is preparing or experiencing lower than expected results, they trade that property in on another or purchasing a property of their own to control that experience. Hunting land prices have remained stable to trending upwards and remain strong overall in Western Wisconsin, Southeastern Minnesota, and Northeastern Iowa. We have some of the best deer hunting in the country in these areas with huge body sizes, big antlers along with beautiful terrain, and excellent trout fishing. The general economy and growth in major cities in the areas of Rochester, La Crosse, Winona, Waterloo, Cedar Rapids, Dubuque, Minneapolis, St. Paul, Mankato, and Decorah are diversified and healthy also allowing for 1031 exchange buyers exiting out of other appreciated real estate into rural recreational land purchases.
Tillable land prices have remained stable in Northeastern Iowa and trended down in Minnesota and Wisconsin this month. This is because of the quality of the available tracts that were traded and additionally affected the struggling dairy commodities.
If you or someone you know is interested in having a tract of land they own valued for a sale, check out our new land evaluator on our website. If you are wondering what is the best time to sell farmland or when is the best time to sell hunting land you are welcome to have a free no obligation evaluation completed by one of our knowledgeable agents. They are available to help and add value to any of your land questions.
We hope you had an enjoyable Thanksgiving and look forward to helping you with any of your land real estate needs.
Archives
October Land Report
Land prices for the month of October 2019 trended flat, however there was an increase in sales volume over the previous month. We have nearly tripled the amount of land sold company-wide over the previous month and prices remained stable in every category. In volume of land in specific categories we saw more acres of tillable land trade than timberland, which is due to tract size. The number of timberland vs the number of tillable land sales were very comparable. Land prices for hunting land ranged from $3000-$6000 per acre based on income, building site quality, deer management neighborhood, and state. Timberland is applicable as ”like-kind” real estate from a 1031 exchange perspective; so we did see that purchase method used multiple times exiting other land, commercial, or income producing residential real estate.
In tillable land, we saw ranges from $5000-$11,000/acre; this is again based on quality of CPI or CSR2, water or drainage, field size, rent ability, access, exposure, and geographic location. The prices in Iowa to be higher per quality point than Minnesota or Wisconsin land prices.
The question comes up consistently; “What are land prices doing?” This question obviously has many answers; although the stock market and economy are strong and interest remains low. We are experiencing tough Ag markets and weather in some areas, but the support from non-operator buyers or diversified operators out of farming is keeping the market strong. We have nearly 500 acres scheduled for auction in November and December, and we are expecting the market to be very strong through 4th and 1st quarters.
September Land Report
September 2019’s Farmland Prices mirrored what they did in 2017/2018 especially at auction. Preharvest auctions that are strictly row crop farms can be a gamble, due to a few hot topics from our experience when sold preharvest. Operators are concerned with an early frost, wondering what yields will be, and have yet to harvest any of the inputs they have been putting in the ground all year. Investors are wondering if there will be an influx of sales post-harvest; flooding the market and creating a buying opportunity, so they remained patient with plenty of time before year end.
The data from 2017 and 2018 similarly showed that good farms sold at expected prices from summer sales; primarily to neighboring operators or exchange buyers, however poor-quality farms were very hard to trade at market prices and have a qualified buyer bidding. When sold post-harvest the good farms brought the same or more, and the lower quality tracts had buyers at expected market prices. When timberland or multi-parcel bidding opportunities were added to the mix, they sold even higher especially if hunting rights were given for the current calendar year prior to closing.
Timberland prices for hunting, rural building, and timber investments has remained strong overall. We had a lot of questions regarding diseases affecting land prices and the answer is yes. There are less buyers for land in the areas that are having all the targeted animals removed. Timberland prices are determined by many factors; just like tillable acres, if you are interested in deer hunting and want a quality experience, you must go where the deer are. The negative will always have a positive effect elsewhere, and we have seen that evidence in hunting land prices continuing to be very strong in markets that do not have disease concerns.
We are very excited for the upcoming Hunting and Harvest seasons. Our agents enjoy few things more than having a client take an excellent crop, or world class animal off a property we helped them purchase. If you or someone you know is interested in buying or selling land give one of them a call. They are a wealth of knowledge in their market and happy to help anyway they can.
August Land Report
Farmland Prices for the month of August 2019 showed stability and trending upward. There were many farms sold in every category with many different sales methods utilized.
High-quality property continued to bring top dollar while medium to lower quality tracts again were responsible for the stability. In Iowa we saw multiple high-quality farms go over $10,000 per acre, Wisconsin followed with over $7,200, and Minnesota in the high 6’s to low 7’s on the choice tracts. The recreational property followed suit with properties having great quality bringing well over $5,000 per acre in Iowa and Wisconsin and in the $3500-$4000 range in Minnesota. The medium to low quality tracts sold 25-55% lower depending on neighborhood, organic certification, timber quality, building site availability, and scarcity in the markets.
One point of major interest is the number of “investor” non-farmer buyers we have seen in the marketplace. With an interest rate decline, big stock market swings, and great rent support we have seen many non-operator or lease back situations taking place. Our buyers on tillable acres were more investor buyers than farmer buyers this month. Hunting land buyers this month were primarily people looking to build in the country, 1031 exchanges, stock market exits, Legacy purchases, and partnerships primarily focusing on whitetail deer hunting.
Land as an investment is often overlooked due to it not being very “noisy” in the grand scheme of investment options. Land as an investment not only produces a stable return but offers some unique opportunities that other investments cannot. Land as an investment provides our buyers with security, usability, infrastructure depreciation, appreciation, and cash flow.
If you or someone you know is interested in buying or selling land, have them give one of our agents a call. These people are top notch when it comes to answering land questions and most have owned many farms personally over their lives. We wish everyone a safe and prosperous start to harvest and hunting season.
2018-First Quarter 2019 Land Report
Farmland Prices for the last 5 quarters have reduced overall about 7% during the term in our entire service area of MN, IA and WI. We have seen the high quality tracts hold their value slightly lower than where they were last year at this time. The mid to low quality tracts have slipped bringing down the overall average. Prices have currently stabilized in each category and we have many buyers in the market to purchase land in 2019. Our attention continues to be focused on interest rates, world trade, commodity prices, and weather for timely dry planting. Cropland lease rates have adjusted down an average of 9%.
Hunting & Rec Land Prices for the last 5 quarter term have increased 12% overall. The recreational property has a classification similar to tillable property. The properties of high quality have experienced a higher gain than the average bringing the marginal and low quality up with it. Timber, Hunting land quality, buildable sites, and water sources are some of the many
important topics determining quality. We currently have many buyers in this category as well and this market continues to rise with more interest as the weather improves.
Buyers of Land were 1031 exchange buyers, expanding farmers, recreational use, cash investors or re-entering past land owners, stock market exits, business use buyers, timber investors, and future home site buyers.
Sellers of Land were settling estates, 1031 exchange sellers, business partnerships, relocation due to hunting neighborhood, retiring farmers, geographically consolidating operators, and very few lender forced sales.
Sales Methods: our primary source of sales was traditional listings, follow by live and sealed bid auctions. We also completed a number of off market private sales and were involved in many 1031 exchanges.
We hope you find our annual High Point Land Report beneficial to you or your business. If you have questions regarding the information provided please feel free to contact our office at 507-218-1243 or Sold@hpraa.com
Food Plot Design
The biggest factor of food plot design is having your food in the right location. This plot is on the south side of the wood edge which makes it very huntable with any predominant north wind. This weekend we knocked down a 40 yard patch to shoot with the bow from an elevated blind and made a path down the middle for 2 reasons. To see the deer coming from across the plot and to funnel them right to the stand. Every deer that came from behind the food plot took that lane right down to us presenting a broadside shot, including this tank of a buck. If you would like to put together a plan for your hunting property let me know. I would love to help you out!
-Minnesota Land Specialist Lucas Mestad
Hunting Property Plan
After selling this hunting tract, the buyer asked me what I would do to improve the property. I put this plan together for him, the green areas will be future food plots. The biggest plot to the south will be the late season plot to help hold deer through the winter months. The other two will be early season staging plots to the larger food plot and to the major grain food source to the east. The largest food plot will be planted with brassicas this year and will have brassicas and soy beans next year when he has the growing period needed. The smaller staging plots will be planted with clover and chicory. The red areas marked on the map are where the new owner will go in and cut down some tree tops and add thick cover with old Christmas trees and other things to help make those prime bedding areas. Also, not shown he will add a small watering hole in the wash running through the middle of the property. The property already has great deer and turkey traffic for 20 acres but this should really help pull some big bucks to the property.
-Minnesota Land Specialist Lucas Mestad
What Are Land Prices Doing?
June 2018 Iowa Land Auction Results
June 2018 Iowa Land Auction Results
We saw a lot of great sales in the month of June across the state of Iowa. Info is provided by “the Land Talker” Jim Rothermich, Real Estate Appraiser
What to Look for in a Timber Tract or Hunting Land
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246 Acre Iowa Land Auction
RECENTLY SOLD! Here is the highlight video from one of our most recent auctions in Iowa. The auction went extremely well and we had a great turn out. We would like to thank all the people coming out and the Rose family for this great opportunity.
Recreational Property Improvement Update
Land Auction vs Listing?
Land Auction vs Listing?
There are many factors to consider when deciding if a land auction or traditional listing is the best choice to sell your real estate. The questions we start with before we get into the pros and cons of each sales process are;
1) Is this property going to be sought after by more than one person?
2) Does it currently have an established value? and
3) Does the seller have time to wait?
“A real estate auction can be a very lucrative sales process when executed properly”; says Jacob Hart, Land Auctioneer with High Point Realty and Auction in Decorah, IA. “We often sell property at a much higher price at auction than we would ever traditionally list it at”, says Hart.
The auction process starts with the property being marketed with the seller’s terms established so buyers can set the price based on those terms. Many times, this is easier and favored by buyers due to the level playing field and ease of a take it or leave it transaction without complicating things. When the auction marketing starts the date and location are set for the sale, terms published, and all interested buyers are sent a very nice package of pertinent information. The auction may be a sealed bid, private or public sale depending on what process is best suited for the property and seller’s intentions. When auction day arrives, we start at the opening bid and go up from there.
On traditional listings sellers start with an asking price set at the market value and typically sell there or offers come in below. Land real estate is a very in-depth market and the farms we sell often times have not been sold for many generations. Attempting to put a listing price tag on something that has not been available most times in any buyer or sellers lifetime is a hard thing to do.
An auction also allows the seller to have a definite date when they will have the property sold to move on. An average sale is scheduled 45-60 days out and closes 30 days after the auction. This gives sellers a schedule for planning their next move and may save them taxes, interest, and maintenance at the same time verse waiting 6 plus months to sell their property.
A land auction verse traditional land listing has many benefits for the right property or owner’s situation. If you have questions about a land auction as a sales method for your property. Give one of our offices or land agents a call. They would be happy to give you their honest knowledge about which sales process may be the best to sell your property.
Uses for a 1031 Exchange in Real Estate
Did you know an IRS Code 1031 Exchange can be used to purchase land?
Land is an income producing piece of real estate in most cases. If you have an apartment complex, rental property, or commercial property that has increased in value it may be a great opportunity to sell and exchange tax deferred into a hunting farm or tillable land investment. The exchange between commercial income producing property and land can be the same, as they can both be viewed as “income producing, non homestead, Real Estate.” Well what about land that doesn’t have any income through buildings, CRP or tillable acres you might ask. Land that doesn’t have any income today may very well have long term income opportunities in timber or other sources and the property doesn’t have to necessarily be income producing at the time to be exchangeable. The 1031 Exchange has long been one of the best opportunities to buy and sell Real Estate tax deferred and the real estate that you own can be enjoyed in many different ways, whether you get enjoyment from fixing a broken pipe or having to hang that darn deer stand is a choice you will have to make for yourself!
– Broker Jacob Hart
Quick Turkey Hunting Tips
Get in Close
The first thing you need to do is locate a gobbler. That means either roosting them the night before, finding them roosted first thing in the morning or finding them in their strut zones glassing. Either way, once you have found them I like to get as close to them as I can before I start calling. It makes it a lot easier to convince a longbeard to commit and come to your calls if you are nearby.
Be Mobile
The biggest key to success while turkey hunting is always being mobile. One of the best assets I have in the turkey woods is a good turkey pack. It allows you to set up in seconds with or without a tree while being comfortable and in great shooting position. If you are set up on a tom but they are being stubborn. Don’t be afraid to be quiet for 15-20 minutes and then make a move on them to get closer, or just to add some movement to your call. Even if you move away from the turkey you can still add that movement and end up pulling those stubborn birds in for a shot. If you can’t get that turkey to commit that day, leave them be and don’t push them too much. If you have the luxury of hunting a large tract of land or other property, let that turkey be and go try and find another one that is more active and use that bird as an option another day when he’s feeling more aggressive or possibly not hen’d up.
Don’t Over Call
Once you get the longbeard to start responding to your calls and you hear him getting closer, ease up on your calling. The worst thing you can do is over call. The turkey will be much more likely to hang up out of range and make you (the hen) come to him. Once I know the tom is committed to coming I quit calling, even when he continues to gobble I will rarely call back to make him come looking.
Enjoy the Moment
Once the longbeard is in your effective range, then it’s time to hit him hard with the calls if you can. There is nothing I love more than to get a turkey hammering at 10-20 yards in your face. As long as he’s being calm I like to sit back and enjoy the show they put on. Once you can’t take it any more its time to click the safety off or clip on your release, take aim and take him!
I hope that this quick read will help you this turkey season!
– Minnesota Land Specialist Lucas Mestad
Grade A Tillable Ground For Sale
Located in Mower County, Minnesota, this 160 acre parcel is the classic flat, black and square tillable tract. The property has CPI’s in the mid 80’s, drains well and features patterned tile throughout the entirety. The property is located just a few minutes southeast of Blooming Prairie and is located just off of a blacktop road with an access road that goes to the middle of the property for easy access. The property is currently not rented out and is farmed by the owners.
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Land Auction in Allamakee County, Iowa
Great River Living in Allamakee County, IA
World Class Wisconsin Deer Hunting
https://www.highpointlandcompany.com/properties/80-acres-monroe-county-wisconsin/
Awesome Outdoor Educational Night Out
Come on down to Forestville State Park at 5:30 tonight for a field day. We will be learning about “Using Fire for Vegetation Management” which will include topics like comparing a regularly burned woodland with one that has not, evaluating the benefits burning has on local wildlife, and creating a firebreak and understand the permitting process. There will be a light supper served before hand as well!