When Land Changes Hands, Opportunities Abound

January 30, 2017 02:14 PM
winter wheat

Opportunity knocks when land changes hands, but maybe not in the way you first think. USDA says 93 million acres of farmland will change hands between 2015 and 2019. That might sound like a lot, but it’s only about 10% of the nation’s total farmland of more than 911 million acres. 




Most of that will stay close to the existing owners, changing hands through wills, gifts, trusts and relative-to-relative sales. Still, “this translates into opportunity for farmers,” says Moe Russell, an Iowa-based farm consultant and Farm Journal columnist, whether they’re out to buy or rent additional land.



Operator landowners acquired more than 50% of their owned land through a purchase from a nonrelative, while non-operating landlords acquired more than 50% of their owned land through an inheritance or gift.



As land changes hands, many landlord-farmer relationships will change, too, says Mike Walsten, editor of Farm Journal Media’s LandOwner newsletter. “Anyone who wants to expand needs to be constantly thinking, ‘What would I do if the next-door 60 came up for rent,’” Walsten says. Most leases are renewed annually.



The Takeaway

Be on the lookout for, or actively seek, new owners who might be open to change. Some farmers will also enjoy outstanding buying opportunities for the land that does hit the open market, Russell points out. “With strong working capital and equity greater than 60%, they’ll have opportunities,” he says. Use the data on these pages to look for yours. —Susan Skiles Luke

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Spell Check

bad axe, MI
2/1/2017 07:41 AM

  This whole land thing all works out for the landowner as long as Trump can keep everybody buying in to this 68 trillion dollar credit market debt this country has racked up. If you take there number of 911 million acres you would have to get $74,643.24 per acre for each and every acre of that 911 million acres of land to pay off what everybody owes in this country. That's why every farm land article you read always has a silver lining in it you have to keep buying into this notion that high land prices are good for everybody . Keeps the producer boat loaded with interest payments on it never paying any principle off on it because of inflation. The seller keeps uncle sam happy with the capital gains tax. The auction company they get there 6% or more. The relatives like the high land prices for the seller that's just more money they get to bum off of mom and dad. Hope it all turns out better than the 80's . Carter's grain embargo, remember $1.50 corn. If we get this into a trade war with all this talk of tariffs of 20 to 35% on imports . These crop prices will go down buy 30% from current level. So you need high land values so you can mortgage it to keep farming , just hope you equity in it to make it threw the bad times, and it's going to get bad .


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