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How low will corn go?

Rec ground is far more tied to overall economy and stock prices over interest rates IMO. Housing crashes, Dow dropping significantly & economic slow down across country will reduce prices. Just like every time, it'll go up and down and long term it'll go up through out the bumps. Rec prices do correlate with AG prices as well and of course re more tillable on ur Rec ground- more AG will impact ur prices. But- again, the more u r taking mainly rec & timber, general economy is always going to b the #1 influence on rec land. Look at it kinda like a luxury item or non-nessesity - kinda like the market for boats, furniture, new cars, electronics - economy crumbles- those markets feel it the worst.
 
Jdubs said:
1983, don't wait for prices on rec ground to come down. They won't. I bought my first piece 12 years ago for 700/ac. and they have slowly increased over the years. When I bought I could care less about corn/bean prices. It was about having my own piece of land with an even mixture of timber, crp and tillable. I also will not buy a piece unless there is running water, not cattle ponds, but a flowing water source. There is a large market out there that simply want rec ground regardless of crop production. That is why rec prices remain stable and will continue to slowly increase. Buy what you can afford as soon as you can.
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You've owned land in Iowa for 12 years, and already an expert on land and land prices. I've lived in Iowa my whole life, and have owned both rec and farmland for close to 40 years. You are wrong my friend. With the cycle of the economy in agriculture; you are about to find out the land game!
 
Droptines said:
You've owned land in Iowa for 12 years, and already an expert on land and land prices. I've lived in Iowa my whole life, and have owned both rec and farmland for close to 40 years. You are wrong my friend. With the cycle of the economy in agriculture; you are about to find out the land game!
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I'm not looking to get in a pizzing match and I'm damned sure not an expert on land prices, but I've lived in Iowa for all but 4 of my 67 years. Counting the acreage I live on, I've owned recreational ground for 35 years & currently have 3 pieces of IA & 1 little chunk of MN. There have been years when it didn't go up much but NONE of it has ever gone down to any appreciable degree, ever. I suppose that maybe it will happen but it will take much more than a drop in ag prices for rec ground to take a real bad hit. If things get that bad, any money you have invested anywhere outside your gun safe won't do you much good. I think buying rec ground is like the Chinese proverb about planting a tree; the best time to do it is 20 years ago, the next best time is now.
 
Yes Droptines I have owned land in Iowa for 12 years and have owned rec land in Iowa, and other states, for a total of 23 years. I stand by my experience and opinion. Have a good one!
 
Land prices are much like stock prices, gold, oil, housing, etc - most the time the experts are wrong and there's always surprises "no one expected". No one has a crystal ball and new records for rise & drop happen in everything every so often. I'll plan for the worst but my passion is in the land market so that's where I'm comfy & I'll stay. No doubt I'll have some waves to ride & I know no one can predict the future - I'm ok with that personally. Any investment has some unknowns & risk, just depends what you're passion is and what kind of risk you're comfy with.
 
A 270 acre farm recently sold here in eastern Iowa after being on the market for 2 years. I had my eye on it but it was just too much money with an asking price of around $3500/ac. Very nice "recreational" ground, mature hardwood timber, good fences, 72 acres tillable/hay ground. Sold for $2050/acre. The farm realtor I talked to and my banker both said the demand for recreational/timber type ground has fallen off substantially.
 
HawkeyeStateHogs said:
A 270 acre farm recently sold here in eastern Iowa after being on the market for 2 years. I had my eye on it but it was just too much money with an asking price of around $3500/ac. Very nice "recreational" ground, mature hardwood timber, good fences, 72 acres tillable/hay ground. Sold for $2050/acre. The farm realtor I talked to and my banker both said the demand for recreational/timber type ground has fallen off substantially.
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I bought a farm like that back in the day. Was asking "THE MOON" for it. That creates a unique scenario..... It sat there forever, for good reason, it was overpriced. Then, it became very stale and the guy couldn't give it away because it had sat on the market so long. During this time, I know for sure, from the seller, he became stressed out with low ball offers and spending so much time selling the land & it became a burden to him. He also got a little tighter financially where he needed to sell. Well, their sat a stale property that actually was/is a tremendous farm - no one would buy it. People thought there "had to be something wrong with it". There wasn't. I bought it for a BARGAIN!!!! He was ready to unload. I still own this farm to this day. :)
 
Sligh1 said:
I bought a farm like that back in the day. Was asking "THE MOON" for it. That creates a unique scenario..... It sat there forever, for good reason, it was overpriced. Then, it became very stale and the guy couldn't give it away because it had sat on the market so long. During this time, I know for sure, from the seller, he became stressed out with low ball offers and spending so much time selling the land & it became a burden to him. He also got a little tighter financially where he needed to sell. Well, their sat a stale property that actually was/is a tremendous farm - no one would buy it. People thought there "had to be something wrong with it". There wasn't. I bought it for a BARGAIN!!!! He was ready to unload. I still own this farm to this day. :)
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Your unique scenario will quickly become a common scenario when interest rates rise and/or the economy goes to poop.

If 300K for 100 acres isn't going to change your life if it gets holes blown in it, go for it. If you are putting your last 60K in it for a down payment I would think twice. If interest rates rise and the economy goes south bringing your job with it, you loose it all. The 5% you will be paying on your loan of 240K will give you 12K to lease some ground in Iowa and go on an Elk hunt out west and still keep your 60K in your back pocket. Just a thought.
 
Thinkin Rut said:
Your unique scenario will quickly become a common scenario when interest rates rise and/or the economy goes to poop.

If 300K for 100 acres isn't going to change your life if it gets holes blown in it, go for it. If you are putting your last 60K in it for a down payment I would think twice. If interest rates rise and the economy goes south bringing your job with it, you loose it all. The 5% you will be paying on your loan of 240K will give you 12K to lease some ground in Iowa and go on an Elk hunt out west and still keep your 60K in your back pocket. Just a thought.
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Barely making it to buy land, I think anyone would advise against that, unless maybe you're a 23 year old punk with no wife & kids. Of course risking bankruptcy in any investment - if the stakes are that extreme, isn't a good idea. A good middle ground I see a lot of.... Guys I know who put 30-40% down and the income makes most the payment, a lot of times it's locked in CRP. Or if they cash rent it, their risk is their cash rent going way down, which likely will happen. Can they make up the difference? Most folks I know can and prepared for rockier roads. If a scenario like that could trigger a massive financial failure for you, absolutely not a great idea to buy land.
 
Thinkin Rut said:
Your unique scenario will quickly become a common scenario when interest rates rise and/or the economy goes to poop.

If 300K for 100 acres isn't going to change your life if it gets holes blown in it, go for it. If you are putting your last 60K in it for a down payment I would think twice. If interest rates rise and the economy goes south bringing your job with it, you loose it all. The 5% you will be paying on your loan of 240K will give you 12K to lease some ground in Iowa and go on an Elk hunt out west and still keep your 60K in your back pocket. Just a thought.
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What is the target price you'd be looking for rec ground to come back to before you think its a good time to buy again?
 
Land will always be a good investment because they quit making it about 40 years ago, unless you consider volcanoes, and you ain't growing nothing on lava for about another 2000 years. With urban sprawl and 'squatters' moving to the country land is being removed from our great outdoor pleasures.
 
Local corn prices are 2.93 in my area. If this stays low for 2 years we will have a change in rents and land values.
 
If corn hits 2.50 a guy should buy futures!

Possible double or triple, that's how a guy makes money
 
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