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Veteran Advisor

Up, Down and Sideways

Yep, that is interest rates, and farm loans, prices and land values.

 

"Demand for agricultural credit remained high and loan volumes continued to increase in the first quarter of 2019. To meet growing demand for financing, lenders, especially small, agricultural banks, increasingly have used loan participations and Farm Service Agency loan guarantees. Despite ongoing demand for farm loans and adjustments to lending portfolios, delinquency rates on farm loans have remained low. Interest rates on farm loans continued to rise, but farm real estate values remained relatively steady through the end of 2018."

 

My question is when do land values fall?

 

 

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2 Replies
Honored Advisor

Re: Up, Down and Sideways

Well, if you throw out the crazy northwest Iowa Dutch farmers paying $13,000, land values have soften up.  I don`t think yet interest rates have went up enough to spook anyone`s desire for farmland, it`s everyone resigning to the fact they`ll never see $4,50 cash corn again in their lifetime that`s cast the current pall on land values in Realville.  It`s when the banker strongly suggests a farmer sells a 80 or quarter to get operating money is when the supply on the market will out strip demand ...let`s hope we never see that.

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Veteran Advisor

Re: Up, Down and Sideways

I wont sell land to raise operating money.  If it comes to that point I'll rent it out and let someone else come up with the operating money.  Long as I can make the land payments

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