Farmland sales soared to back-to-back record highs in 2022, with reports of $25,500 per acre in Sioux county, Iowa, in the first quarter.
Farmland Prices in Iowa
The accelerated highs in 2022 don’t look to be hitting the brakes in Iowa in the first quarter of 2023, according to Jim Rothermich, vice president of Iowa Appraisal.
“There’s almost the same number of auctions in 2023 as 2022 for farms selling at $20,000 per acre and higher. Market conditions in 2023 are slightly lower than 2022, but the current market is very solid,” Rothermich says.
Volume of Acres, Given the Market
With this many sale bills on the table, you might think the volume of land sales will slow. If that’s what your crystal ball shows, Rothermich says you might be in for another surprise.
“This was the highest [auction] volume since I started keeping track. I did not see this coming,” he says. “Comparing March 2022 to March 2023, volume is up 68%.”
One of the larger-acre sales that contributed to this 2023 number came from Plymouth Country, Iowa, where 149.91 tillable acres sold for $24,000 on March 10.
To Keep or Sell?
So, what does this mean for sellers? As of first-quarter close, Iowa’s farmland market conditions have stabilized from a super cycle that stretched over two years, according to Rothermich. With this in mind, he has a few suggestions for landowners looking to sell in the next 12 months.
“This market is not at the top, but it is close with historical highs. As time expires, those cash reserves in the countryside will disappear. The 2023 crop will be the most expensive in history. 2023 net farm income is forecasted to be less than the previous two years. Corn ending stocks are projected to be above the past several years which will put a lid on corn prices,” Rothermich says. “Educate yourself about market conditions. You may decide to sell the farm sooner rather than later.”
