This report is broken down by 9 Crop Reporting Districts across Iowa. Find your District here.
District 1 Buena Vista, Cherokee, Clay, Dickinson, Emmet, Lyon, O’Brien, Osceola, Palo Alto, Plymouth, Pocahontas, Sioux County
District 2 Butler, Cerro Gordo, Floyd, Franklin, Hancock, Humboldt, Kossuth, Mitchell, Winnebago, Worth, Wright County
District 3 Allamakee, Black Hawk, Bremer, Buchanan, Chickasaw, Clayton, Delaware, Dubuque, Fayette, Howard, Winneshiek County
District 4 Audubon, Calhoun, Carroll, Crawford, Greene, Guthrie, Harrison, Ida, Monona, Sac, Shelby, Woodbury County
District 5 Boone, Dallas, Grundy, Hamilton, Hardin, Jasper, Marshall, Polk, Poweshiek, Story, Tama, Webster County
District 6 Benton, Cedar, Clinton, Iowa, Jackson, Johnson, Jones, Linn, Muscatine, Scott County
District 7 Adair, Adams, Cass, Fremont, Mills, Montgomery, Page, Pottawattamie, Taylor County
District 8 Appanoose, Clarke, Decatur, Lucas, Madison, Marion, Monroe, Ringgold, Union, Warren, Wayne County
District 9 Davis, Des Moines, Henry, Jefferson, Keokuk, Lee, Louisa, Mahaska, Van Buren, Wapello, Washington County
With the aid of 1,674 farmers, landowners, farm managers and agricultural lenders from every county in the state, who answered based on their knowledge of typical cash rental rates for the year 2014, the Iowa Farmland Rental Rate Survey has shown a small decrease in rates as compared to the previous two years in relation to high, medium, and low quality cropland in the various districts and counties throughout the state. Even so, over a five year period, 2014 marks an increase in rental rates per acre of land across the board, which means that while there is a noticeable fluctuation from one year to the next, over the medium term, the market seems to be gaining favorably.
As an example, let’s take a look at corn and soybean acres for rent in Crop Reporting District 1. The average rental rate for 2010 in this area was reduced to $188, an amount that climbed to its highest point in 2013 at $283 and then decreased somewhat in 2014 to end the year at $270. A similar pattern can be seen in District 5, where the going rate in 2010 was $195. Over the next three years, the rental rate of this district climbed exponentially, reaching $297 in 2013 and settling at $284 in 2014. The only Crop Reporting District in which fluctuations have not been as marked is Crop Reporting District 9, where the going rate in 2010 was $169. This number grew to $229 in 2013 and has remained in place during 2014.
Of course, these numbers are only averages, and the final rental rate can be higher or lower depending on a large number of factors, most of which are related to the topography and fertility of a certain tract of land. For instance, smaller fields with terraces or creeks can bring in a lower than average rate, as would those fields that are difficult to access or which may have a lower fertility rate than others in the area. On the other hand, a higher fertility level of the soil or above average grain prices in the area would implicate an increase over the average rental rate.
In this manner, the rental rate per acre of land on a statewide basis ranges between $52 and $316, based on the type of crop it will produce and the overall quality of the land, as is shown in the following table:
Iowa Farmland Rental Rates
A notorious difference can also be found in the different districts across the state, with the highest rental rate for corn and soybeans being found in Districts 1, 4 and 6, and the lowest in Districts 8 and 9 as follows:
Note: The second rate shown for Districts 1, 2, 4, 6 and 9, relative to corn and soybean production, represents the rental rate for irrigated land.
Additionally, the 2014 rental rates for fields with hunting rights range from $8 to $27, while those used for cornstalk grazing range from $7 to $20 per acre, depending on their location. It is important to note that these numbers are only representative of the acreage itself, and do not include any added value that could be acquired through the inclusion of buildings or storage facilities or any current contracts, which include those for manure application or seed production. For more detailed information, which could be helpful to those looking to apply a fair rate to their farmland. You can download the full report here: 2014 Iowa Farmland Rentral Rates
For information about selling or renting farms contact us at DreamDirt.com We are licensed to sell farmland. Our land brokers and auctioneers provide private treaty listings and auction services for crop leases, real estate, farm machinery and estates. You can call us at (855)376-3478
News of a farmland auction in Washington County Iowa has made its rounds through the circuit this week. There have in fact been quite a few farmland auctions over the past month that have brought prices that were higher than some expected them to be. We have written on this on the DreamDirt.com blog as well.
Here are a few examples of recent farmland sales across Iowa
9/9 Louisa County 73 Acres CSR2 68.4 $7000/a
9/10 Dallas County 85 Acres CSR2 85.9 $10,900
9/5 Kossuth County 308 Acres CSR2 77.7 $8,800
8/29 Jones County 168 Acres CSR2 86.4 $13,000
8/29 Osceola County 104 Acres CSR2 68.9 $7,350
8/29 Osceola County 84 Acres CSR2 95 $10,700
8/20 Cedar County 160 Acres CSR2 90 $13,500
8/9 Adair County 134 Acres CSR2 65.3 $4,400
8/6 Madison County 80 Acres CSR2 37 $3300
8/12 Decatur County 72 Acres CSR UNK $2850
8/4 O’Brien County 160 Acres CSR2 92.7 $10.200
8/1 Marion County 71.1 Acres CSR2 80.3 $7200
Thinking of selling a farm? Let us help you understand your asset and the value of it. We offer real estate listings, hyper listings, live and Internet auctions. We specialize in marketing and selling farm assets at www.DreamDirt.com Call today (855)376-3478
The 2013 Iowa Farmland Prices Survey from Iowa State University was released yesterday and we have begun the task of updating the county pages on our website to reflect the new numbers.
This years survey shows us about what we were expecting, a gain of 5.1% or $420 acres statewide. That’s a positive for the land market. There are still many strong factors influencing farmland prices, but they are competing with lower commodity prices and the lack of a Farm Bill this year.
I have attached all of the documents below, you can find information on each and every county and compare it with last year’s prices by whole dollar number or percentage increase or decrease from 2012.
This year is the first time we’ve seen decreases at least since 2009. This year, mostly in northwest Iowa we are seeing individual counties as well as the NW crop reporting district with negative gains.
Northwest Iowa Crop District Average Price Per Acre $10,960 per acre, down 3.9%
North Central Iowa Crop District Average Price Per Acre $9,818, up 2.7%
Northeast Iowa Crop District Average Price Per Acre $9,449, up 2.5%
West Central Iowa Crop District Average Price Per Acre $9,449, up 2.5%
Central Iowa Crop District Average Price Per Acre $9,877 up 5.5%
East Central Iowa Crop District Average Price Per Acre $9,327 up 10.8%
Southwest Iowa Crop District Average Price Per Acre $7,531, up 7.4%
South Central Iowa Crop District Average Price Per Acre $4,791, up 11.2%
Southeast Iowa Crop District Average Price Per Acre $6,994 up 13.3%
Download the 2013 Iowa Farmland Prices Survey Reports
Iowa Farmland Prices Falling Farmland Bubble Predictors Get Their Day
A new report out this week by the Chicago Fed Reserve has some news that wasn’t unexpected. With 6 years of record land prices behind us we knew an adjustment in values was in ahead. The big question is how big will the adjustment be? The prevailing figure I see being thrown around is 20% over the next 2-3 years. For at least the last 4 years the term “Farmland Bubble” has been thrown around, as an Auctioneer I’ve had my share of arguments about what lies ahead. I’ve always said “I don’t see a crash” and I still see no crash coming. In fact last Thursday I conducted an auction in northern Iowa, with cash corn prices that day opening at $4.22 we still sold the farm for $10,000 per tillable acre.
The recent report by the Fed shows that Iowa as a whole state gained 9% appreciation in farmland prices from October 1, 2012 to October 1, 2013 which matches previous survey’s released but whats important to see is that the report shows from July 1, 2013 to October 1, 2013 we were running -1% appreciation. Its easy to see the correlation between the July-August drop in commodities to the drop in farmland prices. We can assume the current patter will prevail moving forward and we’ll begin losing value. That value loss will not be equal and across the board which I’ll explain below.
As an auctioneer and licensed real estate broker here are my current observations in the Iowa farmland market.
#1 There has been an increase in No-Sales around the state. A No-Sale is when an auction does not achieve a sellers expected reserve price. Our company has not experienced a no sale and with this threat out there its more important than ever to choose the right auctioneer, choosing the wrong one can turn into a disaster right now.
#2 Middle of the road and poor quality farmland is still selling but at a reduced price from where it was at last year. If you have a low CSR and below you’ll see this reflected in the value of your farm.
#3 High quality farms are bringing a premium, this is the bright spot in the farmland market right now. A report by the Iowa Realtors Land Institute recently quoted the figure of 10% premium for high quality farms in Iowa. Prices on high quality land with a high CSR is bringing top dollar still today, again if your auction is properly marketed and conducted you can still realize top of the market farmland prices.
Are you considering selling a farm in Iowa this season its important you give us a call at DreamDirt Farm & Ranch Real Estate to help you understand the value of your property and create a professional marketing plan that will help you achieve your farm’s full value.
For weeks this post has rolled around in my head, several times I committed points to paper only to scratch one and add another. I wanted to be sure I covered the most important points. It was only supposed to be 5, then it was 10 but I narrowed it to only the 7 very most important topics. In the end hopefully you’ll better know the questions to as of the auctioneers you are considering to ensure you have picked the right company for the job.
1. Not All Auctioneers Are Equal: When it comes to methods, we are all different, this is really what sets auctioneers apart. When I say methods I am talking about how the actual sale is conducted. I’ve had sellers ask me “why would I pay you a commission when I could just do it myself, I don’t have to be able to talk fast to get up in front of a crowd to ask for bids” Lets be honest, if it was that simple, wouldn’t everybody do it? I’ve in fact seen people try it thinking it was easy, and they got an hard lesson in the value of a professional auctioneer. People tend to forget, people do not come to auction to pay top dollar. Every buyer in the crowd is there to buy it as cheap as possible. Until you have sold thousands of acres of farmland like we have you’ll have no idea how to act, what to say, when to say it, and all of the other things that must be done. An auctioneers methods are his/her “secret sauce” it is sort of like the Colonel’s 11 secret herbs and spices. Its learned over time with a lot of experience, hundreds and thousands of hours of practice.
2. Not All Brokerages Employ An Auctioneer And Not All Auctioneers Are Licensed to Sell Real Estate: Despite the fact that may companies have added the word “Auction” to their name in recent years, they have no auctioneer on staff. Their websites will even boast their prowess in the auction world. Realize this is about market share, picking up an extra commission here and there. Some may have a very very part time auctioneer they will pay a small fee to call your sale, but that is rare.
Another important point to consider, not all auctioneers are licensed to sell real estate. Some auctioneers without a real estate license sell farms but the restrictions on such a sale make it difficult in my opinion to provide effective service to a client. In fact, it became necessary for the State of Iowa to clarify the rules in 2012 and boost the penalties. You can read about that here. Is it important to you that the auctioneer selling your farmland real estate be licensed to sell real estate and have the full ability to market, show and close your farmland transaction?
3. Not All Auctioneers Sell Farmland: There are many auctioneers across Iowa, and most of them will take your listing if they can get it but if you are looking for an auctioneer that sells farmland and is good at selling farmland you’ll need to do some digging and question asking to find out. I know many auctioneers that have never sold a farm in their entire career, but they would love for your farm to be the first. Is it important that the auctioneer you choose have experience in selling farmland? Would you trust a surgeon doing his first surgery? Would you hire a carpenter to build your home if you knew it was his first build?
4. Not All Auction Companies Have The Same Resources: At DreamDirt we’ve built many resources over the years. These resources include contacts all around the state, buyers from around the nation, marketing and advertising resources such as mailing lists, email lists, websites, subscriptions and even physical resources such as auction sound toppers, tents, tables, trailers, technology, signage, mailing and many more things. At DreamDirt long ago we decided to be the best at what we do, we have invested heavily in the resources that help you be more successful, resources that help you sell fast, higher and with the least amount of stress.
5. Farm Management Companies Are Good At Managing Farms: I love my farm management friends, they are good at what they do, they manage farms that is their primary business. Somewhere along some of them decided to sell farmland, why not? They have a captive audience and it would make a nice secondary income right? Maybe that’s a fit for you? Consider this though, when you want an auctioneer that will do the best for you and have no competing interests, an auctioneer who does farmland auctions as a primary activity with no secondary activity would you do better?
6. Bigger ISN’T better, Bigger is “Cookie Cutter” Auctions: I had a client that was considering our services tell me “we are looking at a bigger company, I just think they will be able to do a better job” I was lucky to have that opportunity and I was glad they shared that perspective with me when they did. In the end they hired us to conduct their sale and I’ll share why they made that decision. Large auction companies lack flexibility in many ways medium and small companies don’t. Large auction companies enjoy “big reputations” and all the luxuries that come along with that. Their sales volume puts them in front of a lot of people, they get more opportunities to sell which just continues to snowball. When you stop and think about it though, the majority of the time your sale is being handled by a person that won’t even be at your auction, probably have never attended many auctions. Through the marketing and inquiry phase your asset is being handled by an office worker that is stamping out your auction exactly the same what the last one and the next one will be stamped out. The exact same things are done for each one of them. Your auction does not always have trained eyes on it as many of the tasks are pushed off to others to oversee until auction day when the auctioneer will arrive. This keeps their costs down, maximizes the company profit. When auction day arrives you’ll be dealing with an auctioneer that might be getting a flat fee for calling the sale and no interest in doing a “great” job and if he is a commission auctioneer he probably going to sell 3 farms that week, will he be hungry enough to do a “great” job on your sale? Do you want individual attention every step of the way? Do you want your calls answered? Do you want to ensure that trained eyes are directing the presentation of your assets every step of the way? I bet you do, but if a cookie cutter auction is fine with you then I won’t say it will be a disaster, but it won’t be as good as it could have been!
7 Full Service Isn’t Always Full Service If You Know What I Mean: One of the most misleading statements I’ve seen in auction advertising is this “We are a full service Auction Company” Just what does full service mean? I suppose to everybody it could be something different. To some full service auctioneering is providing the auctioneer, clerk and cashiers for the sale. To some it is providing real estate brokerage services and auctioneering services is full service. To us, its all of the above plus being flexible enough to pick up every possible loose end. I’ll give you a few examples. Recently a client from another state was flying to Iowa to sell his family farm of 70 years. When he arrived at the airport in Des Moines, we were there to give him a ride to the farm 100 miles away. The next day when the old farm pickup would not start we were there to give him a ride to get a new battery. In fact, our presentation crew completely cleaned the entire house, washed the windows and made every asset shine. For another client that lived out of state our crew met them onsite and then spent 4 days pulling every item from 2 barns, power washing them and photographing them for the sale. Its not uncommon when we sell a farm to have other assets that are sold at the same time, that might be machinery, or household contents, perhaps a home and outbuildings. The largest auction companies in Iowa will only sell your farmland, they realize that’s the asset with the most value. We won’t leave you hanging, we are full service and will ensure every lose end is tied for you when we finish. To us, that’s what a full service auction company does… literally everything that has to be done. We pride ourselves on making selling easy.
Choosing an auctioneer is something most people will very rarely every do in life. Its usually a task nobody wants to be faced with. If you do not live your entire life everyday inside the auction business it will be very hard for you to tell the difference from one auctioneer to the other. We ensure that every seller gets an auctioneer that fits them and is there with them literally every step of the way. Our auctioneers are responsible for every facet of their clients sale and responsible for the constant oversight of it, and they have the tools to
Every client we have worked with has different parameters that are important to them, we have built off of their requests and built an auction company with a primary responsibility of being auctioneers. We specialize in farmland and farm assets.
If you want to visit with somebody about selling farmland in Iowa, or a farm estate please call us today at (855)376-3478
We will also be selling the homestead with outbuildings as well as the estate contents. This sale offers a great opportunity for investors, cattlemen and farmers alike. The farm is a nearly level piece of farmland to slightly rolling and its 100% pasture. Its hard to believe a farm of this caliber has escaped the plow for so long. Its a very good grass producing farm and would be the same for corn and soybeans. Its a uncommon farm because its rare to find a non timber, flat or nearly flat laying farm with good ponds, fence and its all pasture. For the cattleman its a gem, for the row crop farmer its a gem because conversion to tillable would be nearly effortless.
Click the listing link above to learn more or call us Toll Free at (855)376-3479 to visit with us about the farm.
DreamDirt Farm & Ranch Real Estate 101 S. Noyes Street Mondamin Iowa 51557
Jason Smith, Broker/Auctioneer (712)592-8965 Jason@DreamDirt.com
I woke up this morning to 39 degrees, it was cold in the house and when I made my way out to feed the cows I threw on a sweatshirt. As a farmer this signals harvest, but as a farmland auctioneer it tells me sales season is coming. The majority of farmland sales occur from November through February when the crop is off and tenancy can change. We have been busy since the last sales season gearing up for the next one. Through the Spring, Summer and Fall we work with seller clients to help them understand the value of their farmland and prepare if for auction. Each year for the last 6 or 7 years we as licensed agents and auctioneers have struggled with putting a solid valuation on farmland. In times of uncertainty its always smart to use the auction method to sell farmland because auctions do not have a cap price like a listing does. When you set a price you are likely never to do better than that price.
As we came out of the 2012 farmland sales season we really did not believe there would be a great deal of business in 2013. 2012 was a unique year with a raise in capital gains taxes coming at year end we as auctioneers pushed a lot of farmland though the sales process last year. To our surprise 2013 has been busy, potentially hussled along by anxious farmland owners that see commodity prices dropping this year as well as increases in interest rates. For the last few years we have seen the farmland market shoot through the roof propelled by low interest rates, record farm profits and investor demand. The picture looks different in 2013. We’ve seen investor demand drop off slightly, interest rates have come off the bottom and commodity prices have fallen during the year.
A recent study released by the Realtors Association shows current 2013 farmland values and their change from March 2013.
The big question right now is what will 2013 hold for farmland prices? I think the answer can change day by day and by the time you read this the picture could easily be different. A new report out in early September on Iowa farmland values shows the steep increases in farmland prices have stopped. In fact it showed that Iowa farmland had only appreciated 1.4% from March 1, 2013 to September 1, 2013 statewide. Iowa’s 9 different crop reporting districts came in with differing numbers in farmland appreciation
Northwest Iowa +0.8% North Central Iowa +1.7% Northeast Iowa -0.7% West Central Iowa -0.5% Central Iowa +1.1% East Central Iowa +5.0% Southwest Iowa -0.5% South Central Iowa +2.0% Southeast Iowa +2.8%
The statewide average is calculated by adding the sum of all 9 crop reporting districts in Iowa and dividing by 9 districts. Its important to look at individual districts in this study to understand where the farmland market is. 3 of the districts ran a negative appreciation for the period while 5 of the districts were up a small percentage. East Central Iowa was the highest at 5.0% appreciation. Considering the average appreciation over history has been approximately 6% it appears that region it keeping pace at least for the time being with the historical average.
Looking forward to the fall and winter of 2013/2014 I think for those farmland owners that want to sell at the top, I’m not sure its any closer a call than this year. I’ve always advised clients not to wait for the top otherwise you may be riding the market down and we can see in some cases across Iowa with softer than past sales there is already some erosion of farmland values. There will be some that will hold on thinking that commodities will come back and I can’t argue that, we are at the bottom of the yearly cycle in commodity prices, they likely will be priced better later in the harvest cycle but I’m not an expert on commodity prices and markets but my conversations with those that are have told me we are likely to see them come off the levels they are now, but nobody expects to see the top prices we’ve seen in the past. Our current stockpiled reserves along with what has been estimated to be a record harvest this year is likely to hold those levels down. With farmland prices so closely tied to the lands ability to produce income you’ll see the two track in line with each other as they always have.
So to answer the question “Are Iowa farmland prices falling?” I guess the answer is over all no, but in some places yes, lets see what harvest brings before we jump to to many conclusions.
If you are interested in more information on farmland values in Jones County Iowa we maintain them on our website and update them every time new information comes out. Click “Iowa Map” above on the right to find farmland values for every Iowa county as well as detailed information on each county.
Interested in selling farmland in Jones County Iowa? We are Auctioneers and licensed real estate salespersons and we serve Jones County and we are happy to offer you a free value evaluation and auction or listing proposal confidentially and with no obligation at all. You can call us or visit “Whats My Farm Worth” page and fill out the form on that page.
How cheap do you want it to be? We sell farms as cheaply as 0% commission to the seller where the buyer pays a buyers fee. Sometimes the commission is all paid by the seller and sometimes its split between buyer and seller.
As an auctioneer farmland commission rates are something I get asked about often. If I could pick the number one question I get asked the most it would be a toss up between “what is the average commission an auctioneer charges for farmland sales in Iowa” and “what do you think this farm will bring” I don’t mind answering either of them for you.
There is no “average” auctioneer commission for farmland in Iowa or Nebraska. Commissions are not set by anybody but are an agreement between the auctioneer and the farmland owner. We charge a commission based on the amount of work and marketing required to sell your farm and the type of auction you choose and the value of the property.
Some farms are very large and the commission rate are very lowr, some are very small and the commission rate is higher. Some farms are very valuable and require less marketing expense which means a smaller commission rate.
DreamDirt provides an exceptional value to our clients and offers something that other auctioneer services do not including our use of online bidding, remote bidding app for smart phones, digital targeting, our VIP list, search engine presence, over 50,000 followers in social media just to name a few. There is a reason so many families and their heirs have trusted DreamDirt to be their voice when welling family farms and ranches.
We pride ourselves in reasonable commission fees that are equivalent to the work required and the value of the farm. If we charged one flat fee you can see how that would not be fair or reasonable to everybody.
If you would like to know what we would charge to sell your farm its easy.