The 2020 year-end land value trends for the association have recently been completed and offer an interesting look at what land values have done in our area in the past year. Our association keeps records of land sales in our area and each year we analyze these sales to determine the direction of the market.
Trends in Agricultural Land Prices
The trend in land prices for this year seem to show a slight recovery in the market most likely due to the recovery of commodity markets, COVID-19 relief payments and an increase in recreational sales. For 2020, we saw good crop land and irrigated crop land saw slight declines. In looking at the sales that took place later in the year, we may also be seeing irrigated crop land value starting to recover in 2021.
For the total High Plains Farm Credit territory, plus a few counties on the edge of our territory, the value of good upland crop ground (which is considered as productive class II soils) showed a decrease of almost 3%. The value of marginal crop ground (soil classes III, IV and VI) increased approximately 4%. CRP showed an increase of nearly 12%, reflecting a renewed interest for recreational purposes. Irrigated land showed a decrease of approximately 2%. The value of pasture increased approximately 6%. These figures are based on closed sales that are considered arm’s length transactions.
Land Values in Our Different Regions
Furthermore, the land values in our area are fairly consistent from north to south. We do typically see an increase in land values the farther east in our territory that we go. The majority of the counties in our area are showing slight increases or slight decreases in land values for each land type. The counties showing increases in values for all land types included Kingman, Rooks
and Russell. Kingman showed increases for the second year in a row. Both Rooks and Russell are rebounding from down years in 2019. The counties showing decreases in values for all land types include Norton and Sheridan. It seems a significant amount of acreage coming on the market in 2020 was detrimental to values in these counties. Marginal crop land (soil classes III, IV and VI) was the most impacted in each county.
The association also completed a study of land prices by region:
- North Region (Decatur, Norton, Phillips, Smith, Sheridan, Graham, Rooks and Osborne)
- Central Region (Gove, Trego, Ellis, Russell, Lane, Ness, Rush and Barton)
- Southwest Region (Hodgeman, Gray, Ford, Edwards, Kiowa, Meade and Clark)
- Southeast Region (Pawnee, Stafford, Pratt, Comanche, Barber, Kingman and Harper)
Furthermore, the North region shows a decrease in land values for most types of land other than pasture showing an increase and irrigated land showing a slight increase. The Central region was up in value in each land type. The Southeast region showed decreases in value other than in marginal crop land. The Southwest region shows increases in values for every land type, with pasture and CRP having the biggest increases.
Concluding Land Value Thoughts
Lastly, this year saw and even larger influence from the recreational buyers in the market. This is likely due to the pandemic and people wanting to spend more time outdoors. The counties that seem to have the most recreational sales are Stafford, Barber, Rooks, Russell and Ellis.
Our association currently has four state certified appraisers on staff that are continuously watching the market and trying to monitor land values. If you have agricultural land that you need appraised for estate purposes, for buying, for selling, or for any other purpose, please contact us. We would be more than willing to discuss doing an appraisal for you.