“What surprises us is the rate of increase over the last 12 months,” said Lee Vermeer, AFM, vice president of real estate operations at Farmers National Company.
Omaha, Neb. (PRWEB) January 13, 2012
The U.S. farmland market continues to be hot, with values reaching a two-year high, according to Farmers National Company, the nation’s leading agricultural services company. Availability of quality land is tight, bringing fast sales and top dollar for properties.
“What surprises us is the rate of increase over the last 12 months,” said Lee Vermeer, AFM, vice president of real estate operations at Farmers National Company. “Values are up 20 to 25 percent, compared to rises of five to 10 percent in 2010. We are looking for 2012 to be another profitable year for those selling land.”
Farmers National Company has seen record auction activity during the last six months as more properties are being sold at auction to maximize profits. Tight supply of quality land has also prompted buyers to look at less productive land that can be upgraded, according to Vermeer.
Strong grain prices are boosting profits for farmers, prompting them to pursue land in order to expand operations. In addition, cash rents in top production areas have increased 25 to 40 percent during 2011.
“Farmers make up 75 percent of the buyers in the market, despite continued strong interest from investors,” said Vermeer. “Land continues to be a tangible investment that has performed well, thus the demand.”
While Farmers National Company projects brisk activity to continue, there are market factors that could impact the future of farm values.
“Overall the upcoming year looks positive,” said Vermeer. “However, poor performance in the commodity market over the next year could bring downward pressure on land values. Good weather world-wide could result in a crop surplus, dropping prices. In addition, inflation would boost interest rates, negatively affecting land values.”
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Farmers National Company, an employee-owned company, is the nation’s leading agricultural real estate and farm and ranch management company. The company has sold over 3,000 farms and more than $1.7 billion of real estate during the last five years. Farmers National Company currently manages more than 5,300 farms in 24 states. Additional services provided by the company include auctions, appraisals, insurance, consultation services, oil and gas management, lake management and a national hunting lease program. For more information on land listings in your region, visit the Farmers National Company website at http://www.FarmersNational.com
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