Last call 2020! With one more closing on the morning of the 31st to finalize the year 2020 we were thankful for two main items. First, we again had our largest sale year ever growing as a company via sales volume, new agents and staff, offices, and geographic service area. Second, 2020 is over and we are hopeful for an even brighter future. This year offered challenges; however, the opportunities, growth, and stability far outweighed the negatives. We had not only an earth-shattering pandemic, but a presidential election, extreme commodity price swings, interest rate fluctuation, major stock market changes and let’s not forget about Derecho to name a few hot topics.
The year started out with low commodity prices especially in soybeans, corn, and dairy. We had a good spring compared to the previous 3 years of substantial rain and flooding; however, the question was will there be profit in the crop that is going in the ground? Then the Covid lock downs came which had emotions and media running wild; however, landowners, buyers, and sellers all seemed to keep their cool. There were unexpected land opportunities in this time as the stock market plummeted and land continued to be exposed to the market. It was expected from countless calls and emails that land prices were headed south, and the great buying opportunity was headed to land, when what happened was the complete opposite. When PPP specifics were released the “what are land prices doing” conversation instantly changed to PPP opportunities. Checks were issued to Americans businesses and the general public. On top of that financial increase and coming off a 4 year economic run up, people also decided that living in congested cities confined to their homes may not be for them. A week or so after the payments started hitting the accounts, the phones started ringing again and have not stopped since. We have more buyers today for land than we have in the last 10 years and land auctions have more registered bidders from around the country than ever wanting to buy.
As I am writing this article corn, soybeans and wheat futures have just hit their highest levels since 2014. That paired with the above points, record low interest rates, and a newly announced PPP round is setting us for a run up. However, just as the above paragraph showed unforeseen events there will always be change. If you are in the market to sell it is an excellent time to cash out if you have been waiting on the prices to increase.
Land prices: December 2020
Iowa:
Timber Land – $3500 – $7000/ac Tract size, hunting neighborhood, buildable, top or bottom access, deer history and water features.
Tillable Land – $5500 – $14,300/ac CSR2 quality, tract size, available markets, local rental rates, tile, CRP rates, timber quality
Pasture Land – $3000 – $5000/ac Good Fence, Water, Accessibility, Tree cover, clean without rocks
Minnesota:
Timber Land – $3000 – $5200+ Tract size, hunting neighborhood, buildable, top or bottom access, deer history and water features.
Tillable Land – $4500 – $13,100 CPI quality, tile, property taxes in the county, and organic operators
Pasture Land – $3000 – $5000/ac Good Fence, Water, Accessibility, Tree cover, clean without rocks
Wisconsin:
Timber Land – $3500 – $6000+ Tract size, hunting neighborhood/deer history, buildable, top or bottom access, and non-resident interest
Tillable Land – $3500 – $9000 Field size, area, soil quality, investor interest. available tenants, yield history
Pasture Land – $3000 – $5000/ac Good Fence, Water, Accessibility, Tree cover, clean without rocks
Americans want land, they always have. They want to live freely in the country, hunt and improve their own rural paradises, farm fertile soil expanding their farming operations and invest in stable low management tangible real estate. This has held true for generations and will continue through up and down, thick and thin. We are proud to be in the land business and believe in what we do so much that most of our team owns land personally or goes to work every day wanting to. We are thankful for the great professionals that we work with on over 100 farms sold again in 2020. More than anything we are honored that our clients continue to trust us to assist them with what is more than likely the largest financial transaction of their lives. To some it’s just a farm or tract of land, but to you it’s a way of life that your family has called home and we will never take that lightly.
Happy New Year and Thank you!