How to Determine What Your Farm Is Worth: A Guide to Ag Real Estate Valuation

Whether you're buying, selling, refinancing, or planning your estate, knowing the true value of your farmland is one of the most important steps you can take as a landowner. An accurate farm valuation empowers you to make confident, well-informed decisions — and choosing the right valuation method makes all the difference.

In this guide, we'll break down the three main approaches to farmland valuation: price estimation services (BPOs), certified appraisals, and technology-driven tools — so you can choose the best fit for your needs.

Why Farmland Valuation Matters

There are many situations where an accurate farm value is essential:

• Buying or selling farmland — setting a fair asking or offer price
• Obtaining a mortgage or agricultural loan — lenders require reliable valuations
• Estate planning and inheritance — ensuring fair and legally sound asset distribution
• Portfolio management — understanding the performance of land as an investment
• Litigation or family settlements — providing documented, defensible value estimates

In each of these scenarios, the stakes are high. Having a credible number — backed by solid research and analysis — protects your interests and supports better outcomes.

Option 1: Broker Price Opinions (BPOs) and Competitive Market Analysis (CMAs)

A Broker Price Opinion (BPO) or Competitive Market Analysis (CMA) is a price estimation service typically provided by a licensed real estate agent or broker at the local level.

What's Included?

The quality of a BPO can vary widely depending on the professional. The best reports include:

• Data on comparable recent sales in the area
• A summary of market analysis and pricing rationale
• Soil productivity/quality comment/analysis
• Evaluation of building improvements (if any)
• Local supply & demand considerations

When Is a BPO the Right Choice?

BPOs are well-suited for:

• Determining a purchase or listing price
• Many standard business decisions
• Certain mortgage or estate processes

What to Know About BPO Providers

Real estate agents providing BPOs are required to complete formal education and pass state licensing exams. However, experience, specialization in farmland, and the depth of reporting will vary from agent to agent.

Tip: Look for agents who specialize in agricultural land and provide detailed, data-backed reports — not just a number based on intuition.

Option 2: Certified Appraisals

A certified appraisal is the most thorough and authoritative form of farmland valuation. It is completed by a state-certified appraiser who has undergone rigorous education, testing, and hands-on experience requirements.

What Makes Appraisals Different?

Appraisals go deeper than BPOs in terms of:

• Research depth — extensive data gathering on comparable sales, soil productivity, and market trends
• Analysis rigor — professional judgment applied to complex variables
• Documentation quality — detailed written reports that meet strict professional standards

When Is an Appraisal the Right Choice?

A certified appraisal is typically required or strongly recommended for:

• Contentious family or estate settlements
• Litigation involving property disputes
• Estate tax purposes, including estate settlements, gifting, and non-cash charitable donations
• Situations requiring a higher level of documentation and credibility

A Note on Qualifications

Certified appraisers must meet state and federal standards — including education, examination, and supervised experience — before earning their credentials. And while all certified appraisers have had rigorous training, it is still important to find a certified appraiser who specializes in agricultural land.

Option 3: Technology and Valuation Tools

Technology is rapidly transforming the real estate and agricultural valuation landscape. From automated valuation models (AVMs) and digital market platforms, these tools are making data more accessible than ever before.

The Power — and the Limits — of Technology

Technology can accelerate the valuation process and surface data points that might otherwise be missed. But farmland is uniquely complex. Soil variation, drainage, physical access, local market nuance(s), and other factors often require human expertise to interpret correctly.

The most effective approach combines the speed and data-richness of technology with the judgment and local expertise of a qualified professional. Together, they produce more accurate, actionable valuations than either could alone.

BPO vs. Appraisal: Which Do You Need?

Both services have real value — the right choice depends on your specific situation and how much documentation and authority you need.

How Hertz Can Help You Determine Your Farm's Value

At Hertz Farm Management, we specialize in helping farmland owners navigate important ownership decisions with confidence. Our team regularly conducts detailed analyses that account for:

• Soil quality and productivity
• Market demand and local trends
• Comparable sales data
• Personalized pricing strategy

We offer:

• Broker Price Opinions (BPOs) — detailed, fee-based reports ideal for many buying, selling, and business decisions, prepared by licensed farm real estate professionals.
• Certified Appraisals — the most comprehensive valuation reports available, prepared by fully credentialed appraisers with agricultural land expertise.

Whether you need a quick market read or a formal, defensible valuation, we're here to help. Call us or inquire online to learn which farmland valuation service is right for you.

Frequently Asked Questions About Farmland Valuation

How often should I have my farmland valued?

It depends on your goals, but many landowners benefit from an updated valuation every 2–3 years, or whenever a major financial decision is approaching.

Can I use a BPO for estate planning?

For basic planning purposes, yes. However, for formal estate tax filings or legal proceedings, a certified appraisal is typically required.

What factors affect farmland value most?

Soil productivity, location, access to water, drainage quality, proximity to markets, farm sector profitability, and local supply and demand are among the most significant underlying drivers of farmland value.

How long does a farm appraisal take?

It varies by property size and complexity, but certified appraisals generally take longer than BPOs due to the depth of research and reporting involved. You can expect a fully detailed timeline at the time of engagement, which will often range from a couple weeks to a few weeks – again, the complexity of your property and situation will dictate the exact timeline.

Ready to find out what your farmland is worth? Contact Hertz Farm Management today to discuss your valuation needs. Call Hertz at  800-593-5263  or visit hertz.ag.

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