Slight Reduction In Overall Land Values
According to the Federal Reserve Bank of Chicago Ag Letter dated May of 2014, there has been a slight reduction in overall land values since fourth quarter of 2013. This is the first quarterly decrease in land values in five years. Cash rents are down 2% relative to 2013 cash rents, the primary cause is due to a 37% reduction in corn prices and 8.5% reduction in soybean prices. The Federal Reserve believes land values are stable for the 2nd quarter, but could see further decline in value depending on future commodity prices. Total number of acres available for sale and sold is down compared to 2013 as well, but it’s still a local market for values and cash rents. It is my opinion this has been expected for several years. I believe a solid stable market never goes straight up. This pause in land values should help build a stronger market in the long run.