Prices paid for Illinois farmland continued the “slightly lower” trend according to the Mid-Year Snapshot Survey completed by the Illinois Society of Farm Managers and Rural Appraisers. The survey results were released at the recent Farm Progress Show.
“In the first half of the year the value of excellent quality farmland is down two percent and average quality land is down 1 percent,” says David Klein, AFM, ALC, Soy Capital Ag Services, Bloomington, Illinois, and overall chair of the Farmland Values program sponsored by the society. “According to our member survey, prices being paid for good and fair quality land prices are very similar from the beginning of the year.”
Klein notes that the survey results indicated the statewide average price for excellent quality land by mid-year dropped roughly $200 per acre to $10,522 from the beginning of 2018. Survey results indicated prices for other land classes were estimated to be down less than $100 per acre respectively.
“Our survey somewhat confirms the survey from the Federal Reserve Bank of Chicago released earlier this month, which showed prices level to lightly higher in the first half of 2018, and is an indication of both the somewhat level nature of prices paid, and regional bias of each group’s respondents,” says Klein. “Location and local ownership continues to be a major factor in the strength or weakness of many areas”.
This is happening when fewer acres are changing hands, and majority of respondents expect that to remain the case into the last half of 2018.
Cash rents to nudge lower
University of Illinois’ Gary Schnitkey, Ph.D., who coordinates the survey, indicated respondents expect cash rents to also trend slightly lower, depending on soil classifications.
- Excellent—$305 per acre to $290;
- Good—$265 per acre to $250;
- Average—$220 per acre to $210; and
- Fair—$185 per acre to $175.
The type of rental agreements are varied and split into these primary categories:
- Share rent leases—31 percent;
- Modified share rent leases—13 percent;
- Cash rent leases—30 percent;
- Variable cash rent leases—21 percent; and
- Custom farming—5 percent.
The Mid-Year Snapshot Survey is conducted each year in July as an addenda to the much more comprehensive annual Land Values and Lease Trends Survey, also sponsored by the society. More details will be available at www.ispfmra.org.
