Mid-Year Iowa Land Auction Results Indicate Stable Market Conditions
July 24, 2023
Jim Rothermich, MAI, ARA, ALC of Iowa Appraisal discusses Mid-Year 2023 Iowa land auction results which indicate the market has been stable.
According to statewide auction results tracked by Iowa Appraisal, Iowa land prices are down 1.7% in six months based on price per CSR2 point.
Iowa Appraisal’s farm appraisal expert Jim Rothermich, MAI, ARA, ALC announces a 13.4% increase in Iowa land values, based on dollars per CSR2 point, for the period January 1, 2022, to January 1, 2023, with a statewide average price for tillable farmland of $178 per CSR2 point (based on a weighted average CSR2 of 77.2). This equates to average statewide dollars per tillable acre of $13,742. The January 1, 2022, statewide weighted average price for tillable farmland was $157 per tillable CSR2 point, using weighted average CSR2 of 79.3, equating to $12,450 per tillable acre.
The first six months of 2022 continued the prior year’s explosive increases, landing up 15.3%. Prices peaked in May then declined, leveling through the rest of the year. Historical amounts of land (almost 150,000 acres) were auctioned in 2022. Auction data suggests the market has “plateaued," though land prices remain at historical highs.
Year to year June 30, 2022, to June 30, 2023, there was a 3.3% decrease in price per CSR2 point. The June 30, 2022, average price per CSR2 point was $181, and average price per tillable acre was $13,852 (with a weighted average CSR2 point of 76.5). Market conditions were remarkably steady.
Reasons for stable market conditions:
Market adjusted to economic conditions in 3rd Quarter 2022 and stabilized.
Market has adjusted to historically high input prices.
Extreme grain market volatility - farmers have potential to have a profitable 2023.
Still large amounts of cash in rural areas looking to buy land.
Inflation has not affected land values due to farmers having liquidity.
Buyers have strong equity positions.
80% of Iowa farmland carries no debt
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If you have questions about the Iowa land market or need a farmland appraisal, you may contact Jim by email at theLandTalker@iowaappraisal.com or by phone at (515) 777-7083. Follow Jim on Twitter @theLandTalker or check out his weekly blog: Land Talk Weekly Blog.