An ag real estate specialist describes the farmland market as durable. But Brent Wiest with Compeer Financial says it’s not uniform across the company’s three-state footprint.
“We have not seen a broad correction in land values across Illinois, Minnesota and Wisconsin. In many areas, values are holding firm. Some areas, particularly where supply is limited or local demand is strong, values have continued to move higher.”
But he adds buyers are becoming more selective. “They are looking harder at productivity, location, and whether or not a farm fits their operation. So, it’s not that the market is weak, it’s that the market is more disciplined.”
He says while there’s still support for good land and strong location, properties with limitations may face more price resistance.
Wiest made these comments during a Compeer Financial appraisal podcast.
EDITOR’S TAKE:
As we have often noted, farmland is typically a very good investment. Farmers/ranchers are almost always on the lookout for an opportunity to expand their operation by adding more land. Land values tend to escalate over time and help to shore up their balance sheet. However, as the article suggests, it must “fit” their operation. Will it pay for itself over time? Is it an adjacent piece that is a once in a lifetime acquisition? How productive will it be when properly farmed? These and other questions are what most farmers/ranchers ask themselves before laying out big dollars for that next land purchase.
When they come into your dealership, just know they will be asking similar questions about why they should purchase a new truck or SUV for their operation. It’s up to you and your ag-trained staff to point out how CAD programs, like AgPack®, can make their decision a lot easier. Since only CAD members can offer AgPack, that alone is a clear advantage. Then, when you point out all the program offers and how they can save thousands in operating costs through exclusive rebates and discounts, the case to purchase becomes even more convincing. Furthermore, these programs are available at no cost to the farmer/rancher and are in addition to whatever deal you might offer – that’s a very persuasive story!
