(Atlantic) Iowa land prices have increased more than fifteen percent for the third year in a row. The Iowa Land Survey was released today and the result, a 23.7 percent increase statewide.
Wayne Nosbich, Certified Appraiser and Associate with Smith Land Service in Atlantic said there are a number of reasons for the continued increase in farmland values.
“Number one farm income is good and long term interest rates for borrowing are low, and it is pretty much a given that tax rates for 2013 are going up,” stated Nosbich. “It doesn’t make any difference what they do in Washington D.C. we are going to see and increase in capital gains and other tax increases as well.”
Land values in Cass County showed an increase of 21.7-percent for an average price of $7,984 per acre. Audubon County farmland values went up 27.3 percent for an average price of $9,215 per acre, Adair County up 20.9-percent for an average price of $6,425, and Shelby County farmland rose 24.1-percent for an average value of $7,984 per acre.
“Farmland is a good investment when you look at returns compared to other investments and I think it would take something negative in the general economy to force the farm economy to lose its’ footing and start heading south,” said Nosbich.
The increase in farmland has also caused production costs to rise as well. In the past, cuts have risen in response to higher commodity prices. This is especially true for rents. Iowa State University estimates have shown a 61-percent increase in the cost per bushel since 2005.
December 11, 2012
11:00 a.m. news