Iowa land values are still strong, despite coming off of record highs a few years ago. Still, tariffs and trade uncertainty are likely to impact farmland values going into 2019, according to Kyle Hansen at Hertz Ag.
According to Hansen, a recent survey conducted by the Iowa chapter of Realtors Land Institute found that over the past six months the state average price of tillable land has come down 1.7%.
“It pretty much puts us to about the same values as what we had roughly a year ago,” Hansen told AgriTalk host Chip Flory.
There was a significant amount of activity in the Iowa land market last year, according to Hansen.
“Last fall, we had some positives in the market, we had good attitudes with our buyers,” Hansen said. “You know, 75-80% of the farms were purchased by a farmer, and we saw some good yields and we saw some positives. So, we actually saw a bump in our land prices over the winter months in early 2018.”
According to Hansen, high yields could help offset some of the commodity price pain farmers are feeling. Still, uncertainty around trade issues could push Iowa land values slightly lower going into 2019.
“The uncertainty that we have what the tariffs, the lower commodity prices, the ending stocks, how's that going to play a factor, as well as the limited amount of land on the market, we've got so many different variables,” Hansen said. “I think primarily, we're probably going to see a little bit of a softer market based on buyers’ attitudes. Having the uncertainty is hard for a farmer. It is hard for a buyer to make a decision when there's so much uncertainty out there. If we could have these trade agreements get established and in place, that might add some additional stability. At least people [would] know what we're dealing with. Right now, we just don't know.”