Land prices / insane!!!
- Thread starter Wi transplant
- Start date
-
- Tags
- None
Hardwood11
It is going to be a good fall!
That’s probably WRP or RIM… permanent easement. No building, no income and possibly limits trails and deer stands.
deerdown
Well-Known Member
I think most agree we're in a bubble on land prices and other assets as well - crypto, homes, stock market, etc. Just so much money sloshing around in the system from the last 3 years. As money gets pulled from the system (if it gets pulled, and how quickly), most of these assets will deflate. Many today either haven't gone thru a serious correction, or forgot, or the old "this time is different" argument.
How deep a recession is anyone's guess, but in my opinion there's recent data pointing to we're just getting started.
Here's info I read this morning ..
“The decline was steep,” said Gene Seroka, the executive director of the Port of Los Angeles, who announced the port’s monthly results in a Friday online press conference.
He said loaded imports in February plummeted 41 percent over the same month last year, coming in at 249,407 20-foot containers. Loaded exports were off by 14 percent at 82,404 cargo containers, and landed empty cargo containers nosedived 54 percent.
“This is a global phenomenon. We may not be at the height of the pandemic, but there are more container vessels sitting idle around the world today than at any time since the pandemic began,” Seroka said. “Spot container rates have declined to nearly three-year lows. Why? The demand is just not there. And that leads to my second point. Warehouses remain largely full. Retailers must clear inventory levels before the next wave of imports arrive.”
It was a similar story at the neighboring Port of Long Beach. Cargo container imports in February shrank 34.7 percent to 254,970 20-foot containers over the same period last year, and exports decreased 5.9 percent to 110,919 20-foot containers."
This farm didn't look too bad.... https://www.land.com/property/203.5-acres-in-Whiteside-County-Illinois/16367941/
How deep a recession is anyone's guess, but in my opinion there's recent data pointing to we're just getting started.
Here's info I read this morning ..
“The decline was steep,” said Gene Seroka, the executive director of the Port of Los Angeles, who announced the port’s monthly results in a Friday online press conference.
He said loaded imports in February plummeted 41 percent over the same month last year, coming in at 249,407 20-foot containers. Loaded exports were off by 14 percent at 82,404 cargo containers, and landed empty cargo containers nosedived 54 percent.
“This is a global phenomenon. We may not be at the height of the pandemic, but there are more container vessels sitting idle around the world today than at any time since the pandemic began,” Seroka said. “Spot container rates have declined to nearly three-year lows. Why? The demand is just not there. And that leads to my second point. Warehouses remain largely full. Retailers must clear inventory levels before the next wave of imports arrive.”
It was a similar story at the neighboring Port of Long Beach. Cargo container imports in February shrank 34.7 percent to 254,970 20-foot containers over the same period last year, and exports decreased 5.9 percent to 110,919 20-foot containers."
This farm didn't look too bad.... https://www.land.com/property/203.5-acres-in-Whiteside-County-Illinois/16367941/
jflournoy
Active Member
Just for some perspective, there are definitely farms *listed for sale* in southern Iowa at 6k/acre that are purely rec farms with little to no $ return, but there are very few like that actually *selling* at that price, or close to it. Maybe if they have a house/pole barn also, but I'm talking about the value of the raw land. I'd go even further and say that even farms in southern Iowa that have some decent $ return from cash rent or crp, if they are still *primarily* a recreational farm, there are very few that are actually selling for anything close to 6k/acre. And there weren't many selling for that even in the peak a year ago, before the market started going sideways or declining slightly as interest rates and inflation started going up. Note I didn't say *any*, but there were and are very few. In the bottom 2 tiers of counties in southern Iowa, most of what has sold for $6,000+/acre is more of an income farm than a hunting farm, or is what I call a "flyer" and not really indicative of the true market down here.
Daver
PMA Member
Just a FWIW...at least 2 bare land pieces sold very close to my place in the last 6 months for at least $5K an acre, one at $5K, one a little more. Another place sold for $17K+ an acre...BUT it had a nice house and shop on it, so that skewed it of course. Another place sold for over $5K an acre, but it also had modest home and a hoop building.
People may or may not be getting $6K'ish an acre, but they are for sure getting something at, or north of, $5K an acre, at least in my neighborhood. Again, just a FWIW. The four pieces I referenced are within a mile of mine.
And believe me...all of the neighbors are well informed of the "going rates". If it wasn't for the normal communication between neighbors, well then one of the selling realtors made a point of contacting everyone within a couple of miles of the place they handled to let everyone know the details of the transaction...AND...that they would be happy to help anyone else looking to sell.
Yes, things could soften, and I hope they do, but right now, in my area, things remain at all time highs.
jflournoy
Active Member
$5k/acre is a long way from $6k/acre
. Especially if we're talking about larger parcels of ground. What county are you in, and just out of curiosity, what were the acreage sizes on these places? I know of some 40-ish acre parcels of raw southern Iowa land (that had some decent $ return though) that have gone for north of $5k/acre in the last few months (though still not close to $6k), but 40's are always in higher demand because they're affordable to such a larger pool of potential buyers, and that is even moreso the case now since a lot of guys who might have been approved for a loan on an 80 acre purchase a year ago might no longer be approved with interest rates where they're at currently. A lot of those people are still in the land market, they're just in the market for a *smaller* piece now.
I know of 4 in last 2 weeks that went for 6,500-8,500. No income. No buildings. Insane
If we didn’t bail these banks out recently - an event like that rippling through market would slow rec BIG TIME. But…. We bailed out…. Again…. The next “_______” will come. Maybe try to Bail that out too. There will be a day, IMO not a massive time down road, we can’t bail a problem out…. Rec will get to be “hey, not as competitive! I got a lot of opportunities to buy! Things sit on market”, etc.
I’m still hearing crazy stuff like above. I’m also hearing more farms sitting on market longer than expected. Now…. On the housing market…. New construction in my area - fell off a cliff!!!!! When that ripples through market & to what degree- who knows. But dang these builders around me went from
Insane busy to slow. Building costs plummeted as well vs a year ago.
I’m still hearing crazy stuff like above. I’m also hearing more farms sitting on market longer than expected. Now…. On the housing market…. New construction in my area - fell off a cliff!!!!! When that ripples through market & to what degree- who knows. But dang these builders around me went from
Insane busy to slow. Building costs plummeted as well vs a year ago.
jflournoy
Active Member
That is definitely insane. Were all 4 of those places in the bottom 2 tiers of counties in southern Iowa? I haven't seen any recent pieces of raw land down here listed publicly even at the bottom end of that range, so I'm guessing these were all private sales. Must have had a history of a booner behind every tree to entice someone to buy at those prices.
Last edited:
jflournoy
Active Member
Lots of places sitting now. Lots of price reductions from original listed price. Especially on the residential side of things. Land and houses are still moving, but the easy money and crazy prices of mid 2021 to mid 2022 are definitely in the rearview mirror.
In my opinion, the biggest obstacle to prices on raw land in southern Iowa (whether hunting/combo land or income producing farm land) coming down in price is getting landowners to be both informed and realistic about the value of their land. I talked to a guy the other day who has 80 acres of pretty decent, 50 csr2 farmland in a county bordering Missouri. Above average quality farm ground for that county. He's an absentee landowner, and follows the land market in Iowa just enough to know that some tillable acreages have been selling in Iowa for $12-$20k+ per acre. What he didn't know (until I told him) was that those are farms in central and northern Iowa with a vast majority of them having 75 to 90+ csr2 dirt. It makes just a *slight* bit of difference in land values:. He didn't understand why his place wouldn't sell for that kind of money until I explained it to him. He told me he had just signed a new lease with his farm tenant at close to $400/acre, and *that* is insane too, for 50 csr2 ground!
yes, bottom tier, i 35 corridor. One was listed. other 3 private.
jflournoy
Active Member
I do remember one now in the last month or so just a bit east of Osceola that was listed just below $6,500/acre. Saw it went under contract very quickly, to my surprise, especially given the large hog facility right next door. I have unfortunate personal experience with living next door to a single hog barn. Can only imagine how bad the stench is with multiple together, even if not directly upwind most of the time.
Arrowsmith1
Active Member
A 42 acre piece just about a mile from my house just went under contract. It was on the market for about a month. I noticed the sign was gone this week. I checked the listing and it has gone from available to under contract.
Sent from my SM-G965U using Tapatalk
Sent from my SM-G965U using Tapatalk
Bingo, that was one of them. Sold for 6450 I do believe.
tall@wide
PMA Member
I own a farm near a hog farm, and it is not nearly as bad as people think. In fact, most of my biggest bucks live right near the hog farm buildings. It's almost like the hog farm keeps predators away and the deer realize it. The smell is not an issue unless directly downwind. Usually, the workers leave around 3pm and you can hear a pin drop after that.
jflournoy
Active Member
That price isn't out of line for a 40ish acre parcel in southern Iowa, just a lot of demand for those given they're affordable to a larger pool of buyers. I also consider at least parts of Davis County to be a little bit of a special situation because of all the Amish communities. Sometimes Amish will pay a premium "above market" price in order to buy land within the Amish community they're moving to.A 42 acre piece just about a mile from my house just went under contract. It was on the market for about a month. I noticed the sign was gone this week. I checked the listing and it has gone from available to under contract.
Sent from my SM-G965U using Tapatalk
jflournoy
Active Member
Don't know how it is for deer hunting, but for living beside, probably a matter of perspective. The hog farm we lived by just about destroyed our enjoyment of life, and it was only a single barn and almost 1/2 mile from our house. But upwind. We lived there for 15 years when the next door neighbor grain farmer decided he wanted to be a hog farmer too. 2,500 head facility, pit manure collection. After they put the first pigs in there, we never could leave the windows in our home open at night anymore, especially because damp/dewy nights seemed to magnify the smell. We'd come home late at night sometimes from doing something in town and the smell was so bad when we opened the car doors that our kids would run shrieking to get inside the house and get away from the smell. Depending on the wind, we could drive past, 1/3 mile away from the barn at 65 mph with windows rolled up and no vent on and could still easily smell the stench.
I will agree that if the wind was blowing the other direction, we usually couldn't even tell the hog barn was there. But our house being downwind of it with the prevailing wind direction in that area, we smelled it more often than not. We were blessed to be able to sell it to someone who grew up in a different county where there were hog barns everywhere, so they were accustomed to the smell.
Arrowsmith1
Active Member
I agree. $5600 an acre is about average for a recreational property in this area. We are fortunate that we bought our farm in 2010 and we got our house and shop built before Covid hit. Our ground would bring about 4x what we paid for it at today's prices.
We don't have any Amish within about 5 miles of us. As a rule of thumb most Davis county Amish farms are within a 10 mile radius of Bloomfield. We are about 15 miles from town. I have asked some of my Amish friends why they have not bought in our area. Their reply was "It's too far from town".
Sent from my SM-G965U using Tapatalk