The recently released Iowa State Extension land values survey gives some insight into what happens when farmland is sold in the state.
Iowa State University extension economist Wendong Zhang oversees the survey. “About three-quarters of the land sold in Iowa is bought by existing farmers, so it’s more typical that Iowa farmers are buying Iowa land,” Zhang says.
Zhang says the 2015 information keeps with the trends seen through the years in land sales. He says it continues to be tough to try and get land to start a new farm operation.
Zhang says only three percent of the land sold in 2015 was sold to new farmers, and that is something that’s been consistent going back to 1986. “So there are some concerns about the access to land by beginning farmers.”
Part of the problem is the cost of land. The average value of farm ground in the state fell by $310 in 2015, but still averages $7,633 an acre. “When the land price is high, rent is also high, which creates additional difficulty for the beginning farmers without a lot of financial assets to get into the market,” Zhang explains. “So, I do think the beginning farmers might be better able to better start livestock production as opposed to row crops, given how the land market is playing out.”
ISU extension has put together a new website that combines the findings of the USDA, Federal Reserve Bank of Chicago, and Realtors Land Institute in determining the land values. “Farmers, land owners and agricultural professionals could view the land visually. So it is a visualization tool that allows people to analyze and see how changes over time and how land values vary across space,” Zhang says. You can see the new tool here.