Iowa farmland values rise slightly

For the first time in more than three years, Iowa's farmland values posted a six-month increase, a new survey shows.

Iowa's tillable cropland rose 0.9 percent, to $6,545 an acre, from September 2016 to March 2017, according to an Iowa Realtors Land Institute Chapter No. 2 report.

Despite the six-month rise, however, the state's cropland values are still on a decline year over year, dropping 2.8 percent since March 2016.

Troy Louwagie, an accredited land consultant with Hertz Real Estate Services, said the six-month increase may indicate farmland values are leveling out after three years of decline.

'I think the take-away from this survey is that it's stabilized,' Louwagie said. 'That sends a message of confidence in our economy and agriculture.'

Where land values go from here, he said, is a bit more uncertain.

'It wouldn't surprise me if we saw (values) slip a little bit more, but I think it will be lower to flat,' Louwagie said.

In the past six months, land values in northwest Iowa rose 3.2 percent, the largest increase of the nine areas in Iowa reporting for the Land Institute survey. Across Eastern Iowa, land values rose between 1.1 percent and 2.6 percent from September to March.

Farmland values are affected by crop yields, commodity prices and the amount of land on the market, among other factors, according to the Land Institute.

As commodity prices rose in the early parts of this decade, for example, so did land values. But commodity prices have declined in recent years, with land values following.

In March 2010, Iowa's tillable cropland was valued at an average $4,268 per acre, according to the survey. That rose to a high of $8,690 in March 2013, but has fallen every year since.

Other surveys of Iowa land values also have shown declines over different time periods.

One from Iowa State University, for example, showed a 5.9 percent decrease in values from November 2015 to November 2016. Another from the Federal Reserve indicated a 2 percent decrease from January 2016 to January 2017.

l Comments: (319) 398-8366; matthew.patane@thegazette.com