Once again, Iowa is seeing a record-high price for an average acre of farmland. The 2023 average is $11,835, an increase of 3.7%.
Rabail Chandio, an assistant professor and extension economist at Iowa State University, oversees the annual ISU Land Value Surveyand said the state isn’t seeing the major increases experienced during the past two years, when farmland jumped 17% and 29%.
“If we're looking at the overall change in the land market this year, we're still at the peak, but we're seeing the peak slowed down a little,” Chandio said.
The survey that started in 1941 uses input from ag lenders, brokers and farm managers to calculate average land values on a county-by-county basis.
“For about 40 counties, we still see an increase in inflation-adjusted values, which means that those values are also recorded high — even higher than the peaks observed in 2013,” she said.
Chandio predicted values will hold fairly steady in the future without a bubble in land values, even though prices are impacted by interest rate hikes, lower commodity prices, higher costs and drought.
“But people expect an adjustment to happen in the market quite naturally and again in the next five years," she said. "They expect the market to pick back up again once these concerns and the situation have corrected itself."
Southeast Iowa saw the biggest gains from people buying land for recreation and hunting. Northwest Iowa saw a slight dip in value. Even so, Sioux County replaced O’Brien County with the highest farmland value of about $16,500 an acre. That’s more than $4,600 higher than the state average.
