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Land prices / insane!!!

New 80 on the market here. Current owners have had it for one year and eight months, purchased for 265k. They are asking 528k, doubling their money if it sales. Seems way overpriced to me, especially since interest rates have doubled.

www.landandfarm.com

80 acres, Chariton, IA, Property ID: 18087217 | Land and Farm

80 Acres m/l, Lucas Co., Chariton, IA, 80 acres in Chariton, Iowa offered at $528,000. View 36 photos, read details, and contact the seller.
www.landandfarm.com www.landandfarm.com
 
So they paid 3,300/acre almost 2 years ago. A pretty good price for the buyer. This looks like a great deer property and would not surprise me if it would sell for $400,000 (5,000/acre) or a little more...especially this close to Des Moines. Still a good profit. If it sells for the $6,600/acre it is listed for I'll be very surprised. But it just takes that one buyer!
 
Of course it may be a seller that's not very interested in selling but would take a crazy price like this if someone happened to be willing.
 
Be a correction but no crash. Had timber sell for 10k per acre ,city people and buddies with cash.
 
Plymouth County, Iowa, a new record was set to the tune of $26,250 per acre. The farmland included 55 acres of high-quality farmland, according to Brock Auction Company, which managed the sale. That means the total bill was $1.44 million.4 days ago
 
Handcannon said:
Plymouth County, Iowa, a new record was set to the tune of $26,250 per acre. The farmland included 55 acres of high-quality farmland, according to Brock Auction Company, which managed the sale. That means the total bill was $1.44 million.4 days ago
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Northwest Iowa is a tough place to live for aspiring land owners.
 
It seems like there is a rash of auctions and land for sale near our area in southwest Iowa. Could be me, since I’ve only been paying attention the past 3 years, but sure seems like a lot. I’ve gone to a couple auctions, and prices are still sky high. What about your areas? Are you seeing more land changing hands?


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cchadww said:
It seems like there is a rash of auctions and land for sale near our area in southwest Iowa. Could be me, since I’ve only been paying attention the past 3 years, but sure seems like a lot. I’ve gone to a couple auctions, and prices are still sky high. What about your areas? Are you seeing more land changing hands?


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There are a lot of heirs taking advantage of record high prices auctioning off ag ground in my area.
 
cchadww said:
It seems like there is a rash of auctions and land for sale near our area in southwest Iowa. Could be me, since I’ve only been paying attention the past 3 years, but sure seems like a lot. I’ve gone to a couple auctions, and prices are still sky high. What about your areas? Are you seeing more land changing hands?


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Look at land auctions from AG management companies…. Hertz for example. Or who ever u want. They manage property for many people who only own it for investment reasons. Many of these companies have advised clients to “SELL!!!!!!!” That advise is probably sound in this market. Yes, they also like to sell as they make a commission but there’s a reason there has been record amounts of dirt coming to auction,…. Many feel it’s the time to “cash in”. That window has passed in a few areas or past it’s peak…. Seeing more no sales & less folks buying due to interest rates, etc. Only point I’m making here: If management companies are advising clients to SELL could one consider that a time that’s not ideal to buy? Maybe yes, maybe no. Again- folks who want to keep land, not in for investment, able to afford or in for long game- no big deal. IMO- gonna continue to be a big rush of folks in next 6 months with huge price tags & expectations on selling farms that probably missed their window. A bit hilarious glancing over some prices on land for sale on Facebook & hand full of realtors putting insane prices on land who are fishing “maybe there’s someone crazy enough to pay it”. That always happens but it’s kinda funny seeing some of these madness prices. Be interesting when a portion of those folks actually NEED to sell & not the buyers out there to pay the crazy prices. Reality will be a disappointment for those folks IMO ;).


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Sligh1 said:
Look at land auctions from AG management companies…. Hertz for example. Or who ever u want. They manage property for many people who only own it for investment reasons. Many of these companies have advised clients to “SELL!!!!!!!” That advise is probably sound in this market. Yes, they also like to sell as they make a commission but there’s a reason there has been record amounts of dirt coming to auction,…. Many feel it’s the time to “cash in”. That window has passed in a few areas or past it’s peak…. Seeing more no sales & less folks buying due to interest rates, etc. Only point I’m making here: If management companies are advising clients to SELL could one consider that a time that’s not ideal to buy? Maybe yes, maybe no. Again- folks who want to keep land, not in for investment, able to afford or in for long game- no big deal. IMO- gonna continue to be a big rush of folks in next 6 months with huge price tags & expectations on selling farms that probably missed their window. A bit hilarious glancing over some prices on land for sale on Facebook & hand full of realtors putting insane prices on land who are fishing “maybe there’s someone crazy enough to pay it”. That always happens but it’s kinda funny seeing some of these madness prices. Be interesting when a portion of those folks actually NEED to sell & not the buyers out there to pay the crazy prices. Reality will be a disappointment for those folks IMO ;).


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I tend to agree with this. ^^ But then, what do I know? :)

For real though...many of the listings that I have peeked at over the past 6 months or so are, to me, well above anything that I would feel comfortable paying per acre. For many, nearly all, of them...they are far less than ideal setups in my mind, for instance:

1. Multiple neighbors sharing long lengths of mutual boundary.

2. Weird "carve outs" where the seller is reserving some portion of the land being sold, presumably for a house, or future building site. But this is making for some peculiar "shapes" of properties. Imagine sitting in your deer stand, waiting for a nice buck to come down the trail and then "BOOM, BOOM, BOOM, etc", from the neighbor target shooting out behind the barn...only they are only 150 yards from your sanctuary, YET, pretty near the center of your slice of heaven.

3. Multiple draws that continue off of the property listed and terminate in the neighbors' field(s). Setting up a prime opportunity for "fence sitters", etc, especially if they are savvy enough to put some food on the end of the draw.
 
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Daver said:
I tend to agree with this. ^^ But then, what do I know? :)

For real though...many of the listings that I have peaked at over the past 6 months or so are, to me, well above anything that I would feel comfortable paying per acre. For many, nearly all, of them...they are far less than ideal setups in my mind, for instance:

1. Multiple neighbors sharing long lengths of mutual boundary.

2. Weird "carve outs" where the seller is reserving some portion of the land being sold, presumably for a house, or future building site. But this is making for some peculiar "shapes" of properties. Imagine sitting in your deer stand, waiting for a nice buck to come down the trail and then "BOOM, BOOM, BOOM, etc", from the neighbor target shooting out behind the barn...only they are only 150 yards from your sanctuary, YET, pretty near the center of your slice of heaven.

3. Multiple draws that continue off of the property listed and terminate in the neighbors' field(s). Setting up a prime opportunity for "fence sitters", etc, especially if they are savvy enough to put some food on the end of the draw.
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In reference to your second point. I have too have noticed some goofy looking 'shapes' come up recently. this one comes to mind right here. I had to check again to see if it is still listed as its been on the market for a bit, still there. https://www.landandfarm.com/propert...ust_30_Minutes_From_West_Des_Moines-17536027/
 
sep0667 said:
In reference to your second point. I have too have noticed some goofy looking 'shapes' come up recently. this one comes to mind right here. I had to check again to see if it is still listed as its been on the market for a bit, still there. https://www.landandfarm.com/propert...ust_30_Minutes_From_West_Des_Moines-17536027/
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Ha! A perfect example...and I hadn't even seen that one. I don't see how one would NOT be terribly frustrated trying to hunt that. But, oh well.
 
The only way it makes “great sense” to buy those odd shape farms is when you can #1) buy them cheap!!! (Which $7k is not ;) ) & #2) hold them until you can buy bordering tracts to “square them up” & solve the poor layout. Killer move if a guy can pull it off.


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That is how my buddy in Eastern Iowa bought 160 acres of woods. They went to these farmers that had trees, figured out who would sell & made a plan. He ended up buying a total of 160 acres of old growth timber that all connected. Back them I think he said it was $3100/acre. Well worth it then. He's gotten some really nice deer, bow & gun, over the years.
 
sep0667 said:
In reference to your second point. I have too have noticed some goofy looking 'shapes' come up recently. this one comes to mind right here. I had to check again to see if it is still listed as its been on the market for a bit, still there. https://www.landandfarm.com/propert...ust_30_Minutes_From_West_Des_Moines-17536027/
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I saw that one too. I thought "The Stealth Bomber Farm". LOL That place on its own would be a nighmare. No matter where you sit, somoene would be sitting close enought to be looking at you and any deer traveling through there.
 
Chew on this ….
A guy buys “100 acres” (whatever - made up) … for $6k/acre. $600,000. Let’s say the ground spits out 2.5% roi = $15,000 per year.
For ease of discussion (not reality) - let’s say it’s 100% financed. 18-24 months ago it was say, 3.5% interest for example…. Interest alone = $21,000. Without principal paid on the loan - it’s a $6k deficit.

Now- let’s say same but now it’s 8% interest…. & going up btw …. $48,000 in interest alone. $33,000 deficit on interest alone.

We aren’t done either. Two .5% rate hikes & a .25% - just over 1% higher yet coming soon. Beyond that - who knows!?!?!????

That’s a staggering change. Guys are not going to be chomping at the bit for 2-3% roi farms with 8-9% interest. Those buyers will vastly be OUT. Will be cash buyers or those with a lot of cash. There will be a 3rd group- those that can still make the interest payment ok AND believe that interest will come down later so they can refi. Bottom line: high leveraged buyers are going to be out of market, already are or very few left. More deals coming. Cash buyers will be more careful. On the other hand - this is when buyers are going to pull out of the market &
BY DEFINITION my opinion- this is when guy who are able SHOULD BE BUYING!!!…. When the deals come. And they are coming. The buyers are evaporating. It’s shifting quickly from sellers to buyers market. There’s other dynamics like a short supply of land & enough cash buyers BUT- overall - deals will be more plentiful. If a guy on here is able to get things done, 4-18 months is going to be the window to find the best deals we’ve seen in years IMO. A lot of other buyers will not be able to deal with these rates & competition for land will be far lighter. Interesting times ahead !!!
 
Will the land go down in price though? I’ve been looking seriously for the last year, but really don’t want to pay 10k/acre. I’m not in a rush and will jump on a deal when I see it, but right now prices in my area (eastern ia) are still a little crazy. They have gone down in the last year but not by a whole lot.
 
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