June 2018 Wallace’s Farmer “MarketPlace Extra”

The summer months are typically the slowest months for land sales, as the focus of the farming community shifts to production of the current crop. However, farms do continue to come to the market, and the success or struggle of the growing season will help determine the direction of the farmland market this fall and winter. At the present time, high quality farms (e.g., productive soils, solid fertility and drainage, and high ‘farm-ability’) continue to draw the most interest and sell well, compared to those farms with poorer soils, waterways or other obstructions. Farmers are the most prevalent group of buyers, although many non-farming investors are active across Iowa.

There are several things to watch for as we transition into the summertime land market. First, as mentioned above, the success of our current growing season will help establish the ‘mood in the countryside’ come this fall; growing another big crop is likely to be supportive to land values, while a poor growing season may foreshadow pressure on the land market. Second, any meaningful increase in interest rates is likely to pressure farmland values. With inflation picking up in the past 12-18 months, the Federal Reserve seems poised to continue raising short-term rates, which will eventually translate into higher borrowing costs for longer-term maturity notes. Next, any significant change in export trade policy (e.g., NAFTA, China, TPP) will directly impact our grain markets, and will also impact the countryside – positively or negatively. The Trump Administration has more aggressively approached our major trading partners with its desire for fair play on the trade front; and, the aggressive approach has created nervousness in the grain complex. Finally, with all the other motion, there’s been little attention given to the negotiations currently occurring in Congress that relate to the new Farm Bill. This topic will very likely impact growers and farmland values. Stay tuned for further analysis as new information surfaces on all these topics.

NORTHWEST
Sioux County: 

65 +/- acres, located northwest of Hull, recently sold at public auction for $13,300 per acre. The farm consisted of 63 +/- tillable acres with a CSR2 of 88.6.  The sale included 2018 farming rights, and equaled $155/CSR2 point on the tillable acres.

NORTH CENTRAL
Mitchell County:

80 +/- acres recently sold at public auction for $9,450 per acre. The farm consisted of 79 +/- tillable acres with a CSR2 of 87.2. The sale equaled $110/CSR2 point on the tillable acres.

NORTHEAST
Black Hawk County:

70 +/- acres, located north of Raymond, recently sold for $7,000 per acre. The farm consisted of 67 +/- tillable acres with a CSR2 of 75.8. The buyer was a local farmer/investor and the sale equaled $96/CSR2 point on the tillable acres. 

WEST CENTRAL
Guthrie County:

118 +/- acres, located north of Guthrie Center, recently sold at public auction for $3,600 per acre. The farm consisted of 98 +/- tillable acres with a CSR2 of 56.8, with 69 +/- of the tillable acres enrolled in CRP, and the balance of the farm in timbered draws.  The sale included 2018 farming rights, and equaled $76/CSR2 point on the tillable acres.

CENTRAL
Hardin County:

77 +/- acres, located south of Eldora, recently sold at public auction for $8,300 per acre.  The farm consisted of 73 +/- tillable acres with a CSR2 of 84.8.  The sale included 2018 farming rights, and equaled $103/CSR2 point on the tillable acres.

EAST CENTRAL
Linn County:

160 +/- acres, located southwest of Fairfax, recently sold at public auction for $11,300 per acre. The farm consisted of 154 +/- tillable acres with a CSR2 of 84.5.  The sale equaled $139/CSR2 point on the tillable acres.

SOUTHWEST
Pottawattamie County:

230 +/- acres, located south of Oakland, recently sold at public auction for $8,200 per acre. The farm consisted of 228 +/- tillable acres with a CSR2 of 77.7, and included a $275/certified acre cash rent credit at closing. The sale equaled $106/CSR2 point on the tillable acres.

SOUTH CENTRAL
Wayne County:

80 +/- acres, located southeast of Humeston, recently sold at public auction for $3,000 per acre. The farm consisted of 63 +/- tillable acres with a CSR2 of 43.1, with 6 +/- of the tillable acres enrolled in CRP, and the balance of the farm in timbered draws.  The sale equaled $88/CSR2 point on the tillable acres.

SOUTHEAST
Van Buren County:

100 +/- acres, located near Hillsboro, recently sold for $6,400 per acre. The farm had 90 +/- tillable acres with a CSR2 of 64.0. The sale equaled $111/CSR2 point on the tillable acres.
Hertz Real Estate Services compiled this list, but not all sales were handled by Hertz. Call Hertz at 515-382-1500/800-593-5263 or visit www.Hertz.ag.

Posted By Hertz Farm Management on June 4, 2018