Farmland hard to find, prices soar - KWWL - Eastern Iowa Breaking News, Weather, Closings

Farmland hard to find, prices soar


Farmland prices across the Midwest are skyrocketing.  In many Iowa counties, it's not uncommon for land to sell at more than $17,000 an acre at auction.  Many of those wanting land are ready to pay it, but not many owners are willing to sell right now.

Al Hook is a Grundy Center banker and also farms land near Parkersburg.  His family farming operation is looking to expand, and purchase some additional land, but finding suitable ground seems nearly impossible.

"We're always actively looking.  It's just really kind of difficult.  With the economy the way it is, farming is really good, and it's just hard to find a better rate of return.  So people are just holding onto their land," Hook said.

Jake Huff, a broker with Whitetail Properties in Cedar Falls says hook's dilemma is pretty common right now.

"If something does come up, a lot of it is word of mouth right now.  As soon as someone gets word of land going on the market, it invokes a bunch of phone calls," Huff said.

Huff specializes in selling hunting ground,  but many buyers also want property than can be farmed, to help offset costs.  Because so little land is listed for sale, he spends a lot of time searching through county assessor records hoping to turn up something.  He's also ramped up advertising efforts in hopes of luring land owners to sell.

"It's just so hard.  If I was just selling tillable, it'd be pretty tough right now because it's almost selling itself," said Huff.

Many of those who are selling hope to ride the market's highs and cash in with record-breaking prices at auction.  Others don't want to sell because they're nervous about possible tax increases next year.

"Some of the guys now I've been talking to still want to sell but rather than cashing in, they'll do a 10-31 and buy something else, until they get a better feel for how the taxes are going to be structured," Huff said.

The harm in the farm land shortage and sky-high prices:  it makes it very difficult for future generations to consider careers in agriculture.  Affording a farming future could come down to inheriting family land.

Strong crop yields in recent years are part of what's driving the high land costs.  But if this year's drought conditions are prolonged, that could lead to a drop in prices.  Regardless, experts don't think the dramatic increases in land costs can be sustained much longer.

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