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Homer000
Friend

Farmland Value Rising

Do you have your portfolio of condos, lofts, and luxury houses but still want to include more properties? Maybe it is time to consider investing in farmland. http://ellidavis.com/toronto-real-estate-news/2011/11/farmland-value-rising These novelties are very positive for farmers. One of fhe most important reason of the price increase is mainly the rising price of commodities and a tight inventory. Will be really profitable business for farmers?

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4 Replies
Whitesand_Farms
Veteran Contributor

Re: Farmland Value Rising

 I noticed how they only listed prices in ontario where a small part of the agriculture land is and no mention about the prairies. I don't think if they checked the stats that only 5% of farmers in the west owned the land, I would guess about 50% and the rest would be family members of farmers that inherited the land with no intention of selling. 5-10 years ago the listings for farmland was 5-6 pages long now it is only a column or two. Another thing I 've noted over the years, whenever you hear mention of "the sky is the limit" that is usually that's when the bottom falls out.

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Kay/NC
Honored Advisor

Re: Farmland Value Rising

I feel that the one aspect of sales of farmland, that people outside of ag forget, is that for a farming family, the ag land is not just an investment and not just a place to live...and i am not speaking of an emotional or sentimental asset here.  A sale of farmland means the loss of opportunity for profit from that piece of land as a working asset. 

 

When a farmer cashes in, it is usually to leave farming and retire or, more rarely, to pursue another way to make a living.  When a person sells a residential or commercial real estate asset, they are not also selling their means of support at the same time, unless it is a businessperson gettign out of a different type of business, like a store or a restaurant. 

 

There are all sorts of places to live, but not nearly as many places where you can make your own living.  When you sell a farm, you need not only to find a new place to sleep, but also a new one to earn what you eat. and every other expense you incur in living. 

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Jim Meade / Iowa City
Senior Advisor

Re: Farmland Value Rising

Recent local sales have been to adjacent farmers. Some have been private and not advertised, others at auction.  Most of the sales have to do with familes that need the money (medical) or where there is no person to carry on the farm and the owners are retiring/downsizing.  

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Kay/NC
Honored Advisor

Re: Farmland Value Rising

Good time for them to sell, and glad farmers are the ones buying.  Generally, you will see lawyers and doctors entering an investment sector, when other ways to make money get less predictable...explains why some were in hog farms in the early nineties here in NC. 

 

Their a$$es are gone now....

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