Haley, Author at High Point Land Company

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What is Land Selling for This Month

Land prices for the month of December 2021 were stable month over month remaining very strong. We had many types of sales this month for many types of properties sold as a traditional listing, off market, seal bid auction, live auction and online auction and all methods very effective at achieving top market prices. 

The general consensus from buyers is still that interest is low, everything to do with income and cashflow is high and there is not secure investment alternatives to land currently. That paired with conversations with buyers about inflation and future tax and basis changes has land prices stable even though a substantial amount became available over 4th quarter and throughout the 2021 year. 

Farmland has not been the only category to see a substantial increase even though that is where many of the headlines have focused. Yes, we have seen an increase in that space from 20-30%, however the hunting land and rural recreational property have increased nearly 50% on average overall. A couple recent examples in Trempealeau County, WI; Chickasaw and Clayton County, IA; and Winona County, MN confirm that high quality recreational land is in the 5-7000/ac range on a regular basis. The explanation is primarily scarcity and affordability even though an argument could be made for increased timber values, CRP, and tillable land rent factoring in on the price. The want for a place to put in food plots for hunting, have a cabin, rural home, pond, or place to shut out the world and call your own has never been higher. When that is paired with interest rates in the 3.25-4.25% range with long term amortization schedules, rate lock terms and a lot of cash or equity increases in the country we have affordability being a major factor more than cashflow of a property much like other recreational land in the nation. 

Farmland on the other hand has not let off the gas and I am not sure if it will, or should I say when it does. I think we will see another plateau mirroring 2013-2018 if I had to look at a crystal ball. Interest rates are getting locked in for 10-30 years, the stock market has been in park for some time, and corn is currently north of $6.00/bu after one of the largest yielding harvests the Midwest has ever seen. This tells me operators and investors alike will have cash pre and post end of year and there will be purchasing power into 2022. Inputs are one item we are watching closely as rents and fuel prices climb as well as fertilizer, chemical, equipment and seed shortages all become concerns. 

We have many listings on our website currently available as well as auctions coming on the market for the first quarter of 2022. If you have questions about land as an investment, a farm offering tax or depreciation benefits or what the land market is doing in your area talk to one of our professional land agents or auctioneers. They are a wealth of knowledge and care about our clients best interest above all else. 

We want to thank all of our wonderful buyers, sellers, farm management, and appraisal clients for another great year in land business. All of us at High Point appreciate your business and trust and wish you a Happy New Year!

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What is Land Selling for This Month

Land Prices for the month of November 2021 were again stable to higher month over month. We had many types of sales this month for many types of property and in all categories land was up. The general consensus from buyers is that interest is low, everything to do with income is high and there is not secure investment alternatives to land currently. That paired with conversations with buyers about inflation and future tax and basis changes has land prices stable even though a substantial amount has become available over 4th quarter.

Farmland has not been the only category to see a substantial increase even though that is where many of the headlines have focused. Yes, we have seen an increase in that space from 20-30% however the hunting land and rural recreational property has increased nearly 50% on average overall. The explanation is primarily scarcity and affordability even though an argument could be made for increased timber values, CRP and tillable land rent factoring in on the price. The want for a place to put in food plots for hunting, have a cabin, rural home, pond or place to shut out the world and call your own has never been higher. When that is paired with interest rates in the 3.25-4.25% range with long term Amortization schedules, rate lock terms and a lot of cash or equity increases in the country we have affordabilit being a major factor more than cashflow.

Farmland on the other hand has not let off the gas and I am not sure if it will or should I say when it does I think we will see another plateau mirroring 2013-2018 if I had to look at a crystal ball. Interest rates are getting locked in for 10-30 years, the stock market has been in park for some time and corn remained north of $5.00/bu after one of the largest yielding harvests the Midwest has ever seen. This tells me operators and investors alike will have cash pre and post end of year and there will be purchasing power into 2022. Inputs are one item we are watching closely as rents and fuel prices climb as well as fertilizer, chemical, equipment and seed shortages all become concerns.

We have many auctions lined up in December as well as pages of property available via traditional listing on our website at www.highpointlandcompany.com. If you or someone you know is looking to take advantage of a 1031 exchange into farmland or hunting land purchase contact one of our agents today. They are very knowledgeable on the topics of land we specialize in.

Have a safe end to harvest and hunting season, we are grateful for the opportunities you have given us in the land business.

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What is Land Selling for This Month

Land Prices for the month of October 2021 trended stable to higher overall this month. We had many sales sold at live public auction, private sealed bid, traditional listing, and negotiated privately in Iowa, Minnesota and Wisconsin. The land market has had substantial interest from buyers and sellers alike and currently property is being absorbed very quickly in the market with cash purchases or approved loans. We are seeing more land hit the market as we move through the start of 4th quarter; however with low interest rates, high commodities prices, tax laws remaining favorable and inflation concerns looming, land real estate is being snatched up when it becomes available at high prices. 
Auctions continue to set the bar and move it higher compared to other sales methods. We recently had an auction in Allamakee County, IA continue for 9 rounds and over two hours of active bidding with over 125 people in attendance and aggressive active bidders on every tract. We also had auctions in Wisconsin and Minnesota have similar results consistently putting timber at $5,000-$7500+ per acre, tillable land over 130/CSR2 or 115/CPI point as high as 248/CSR2 and a new record for a 10 acre building site breaking $34,000 per acre for the tract in Goodhue County, MN individually on Oct 27th. Marketing in this market is where our agents are really shining, exposing property to the right buyers local and nationally and having them compete to purchase high quality properties that have been held by many sellers over 100 years. There is a lot of noise in this market and not getting lost in the shuffle has really proven effective for sellers coming to High Point.  Another place clients are seeing great value in is our land appraisal department that tracks every sale to use as comparables for appraisals for banks, estates, land owners, trusts, and many other purposes. If you are wondering what a property is worth in today’s market, making a purchase, or settling an estate and are in need of a land appraisal in Minnesota or farm land appraisal in Iowa; our team appraisers are very quick and cost effective.  If you are interested in having a land appraisal completed, selling a farm or land at auction, sealed bid auction or traditional listing; contact one of our great team members today. They have consistently been adding substantial value to clients above the remainder of the market and are happy to talk land with you if you have any questions.  Have a safe finish of harvest, great start to the whitetail rut, and enjoy this beautiful fall we have been blessed with.

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What is Land Selling for This Month

Harvest is in full swing as we enter October! Land Prices for the month of September 2021 remained very strong remaining stable as we close on Quarter 3. Looking ahead, we currently have 3,500+ acres scheduled for auction in Q4 across Iowa, Minnesota and Wisconsin, featuring A+ quality farmland, prime recreation ground and highly sought after building sites. In addition to upcoming auctions, High Point also has 3,600+ acres available via listing across Iowa, Minnesota, Wisconsin, and Colorado. Properties available feature gorgeous acreages, investment-grade farmland, prime hunting & timber land as well as ranches available and multiple commercial opportunities.

Auctions continue to “set the bar” across the land market and show no signs of slowing. In Iowa, High Point auctions have averaged over $160/CSR2 point across tillable acres and an average of nearly $10,500/acre. The land market continues to exhibit strength strong for 4 main reasons remaining consistent with last month’s newsletter. Interest rates on land are consistently in the 3-4% range allowing the buyers and operations to have a lower payment and pay more for the property. Pair this with longer amortization schedules, rate lock terms and aggressive lenders competing with one another and you have favorable buying conditions. Commodity prices, particularly corn and soybeans remaining stable in the mid $5’s and mid to high $12’s as we enter harvest. Prices remaining high allow operations and farms to expand, especially when paired with low interest rates. Throughout 2021 we have experienced low volume in the land real estate market, echoing other sectors of real estate markets. Government payments combined with other favorable buying conditions led to increased demand from buyers across all real estate markets. This increased demand has remained consistent, if not increased, today as favorable buying conditions allow buyers to pay more per acre without their payments increasing and land is turned to as a more stable investment to escape the volatility of other markets. Other markets continue to inflate and have a high cost of entry, land is looked at as a safe investment which allows you to experience a consistent rate of return, appreciation, tax benefits, and the benefits of increasing equity through time which comes with real estate investment.

While we are beginning to see an increase in volume come to the market, there simply is not enough supply to keep up with the build up in demand. The long list of registered bidders for each land auction echoes this statement. It could make a lot of sense for your family or operation to explore a sale in this market. There is still plenty of time in Q4 to close on your property. Whether you are considering a sale or adding acres, give one of our land agents a call today.

Another area where we continue to see growth is our land appraisal department that tracks every sale to use as comparables for appraisals for banks, estates, land owners, trusts, and many other purposes. If you are wondering what a property is worth in today’s market, making a purchase, or settling an estate and are in need of a land appraisal in Minnesota or farm land appraisal in Iowa our team appraisers are very quick and cost effective.

Have a safe and successful harvest and thank you to all of our wonderful clients.

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What is Land Selling for This Month

Land Prices for the month of August 2021 remained very strong at levels similar to the previous month. This time of year we are focused on scheduling upcoming land auctions, compiling inventory of deer and wildlife photos on listings, and looking at tillable land rents or new tenant contracts for next years growing season. In the state of Iowa for example the deadline to terminate a farm lease for the next growing season is September 1st. In the event the farm lease is not terminated it continues automatically on a year to year basis based on the current terms of the agreement unless proper notification is served before September 1.

The land market has remained strong for 4 main reasons. First interest rates on land are consistently in the 3-4% range with lenders today in the area from our experience. This allows the buyer to have a lower payment and pay more for the property. Pair this with longer amortization schedules, rate lock terms and aggressive lenders competing with one another and you have favorable buying conditions. The next reason is commodity prices from timber to corn, soybeans, hogs, wheat, cattle, hay, etc have all fluctuated and for the most part much higher than they were a year ago. When this happened people who operate in this space as a farmer or landowner see an increase in revenue and buy more land. Third was covid, not only did this pandemic drive people to the country, smaller communities, and rural in country travel it also made people realize that life is short and want to own something of their own for reasons of food, water, and protection as well as enjoyment out of the city. This increased demand and reduced supply in an already tight market. The last reason land prices have increased and in my opinion will continue to, is the stock market being too high for new investments and buyers wanting a secure place for their money. Once you have made money the goal is to keep it, and there is no better way to do that then purchase a tract of land that produces income from food production.

One thing we do not bring up nearly enough is our land appraisal department that tracks every sale to use as comparables for appraisals for banks, estates, land owners, trusts, and many other purposes. If you are wondering what a property is worth in today’s market, making a purchase or settling an estate and are in need of a land appraisal in Minnesota or farm land appraisal in Iowa our team appraisers are very quick and cost effective.

Enjoy the remainder of your summer and thank you to all of our wonderful clients.

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What is Land Selling for This Month

While many are exclaiming that the country and economy are “returning to normal”, I fall into the camp that is settling into a “new normal”. This thought carries over into the state of the current land market. Strong commodity prices, and land owners seeing the effects of government payments last year, are driving the land market forward. Land prices across Iowa, Minnesota, and Wisconsin continue to be stable and trending upwards. Many counties are experiencing 5 year highs in land prices, up almost 15% from last year. The majority of these sales are resulting from estates and retiring farmers. 
My recommendation for those looking to sell in the current market would be to sell via auction in early fall. The reason being, the “new normal” is being established as we speak by market participants, the market is being set by competitive bidding between expanding operations, investors and first-time market entries. In order to achieve the highest price for your farm in the “new normal”, you must have your farm marketed to each of these groups and have competitive bidding occur on auction day. Selling privately at 2020 prices is not doing your farm justice. Other topics to pay attention to which will have a role as to where the market is headed include; weather affecting commodity supply, potential tax changes which will have a drastic effect on land owners, and the effect of the economy reopening and how it affects commodity prices.
In the last month, High Point has made the expansion to Colorado. Colorado Land Specialist, Kyle Lopez, had his input on the current state of the land market in CO. “It wasn’t that long ago that in Colorado, owning a ranch meant solely on owning it for the agricultural value it produced, meaning that the value it produced was tied to the the crops and/or the the cattle that the range could sustain.” Maintaining the theme with the “New Normal”, Lopez continued, “Today in the current market it doesn’t take long to realize that the agricultural value and what used to be know as the agriculture price tag has now shifted to what we call the recreational value. Ranches are now purchased with the intention of making a profit on the resale of that ranch. More importantly, purchasers of ranches have shifted from truly ‘farming’ to enjoying the recreational and aesthetic attributes of the property.”

The major themes seem to be repeated across all markets whether you are in Iowa, Minnesota, Wisconsin, or Colorado. Inventory is low. When properties do come to market and are marketed correctly, land is selling quickly and at strong prices. With a rapidly changing market, it is important to have a market professional at your side. Whether you are looking to buy and lock in a low interest rate, or take advantage of rising prices to capitalize on your farm’s appreciation, our 20 Land Specialists know how to navigate the market and keep you abreast of changes. Another important note, keep in mind potential tax obligations that may come with purchasing or selling land. Whether your transaction involves an estate, partnership, or 1031 exchange, our Appraisal Team also stands ready to assist. 

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