Main Content

Land Values 2021 Summary Report

The Land Values 2021 Summary report, released last Friday by USDA’s National Agricultural Statistics Service, shows agricultural land values increasing at a rate not seen in nearly a decade. This report and its contents provide one of many indicators of the overall health of the agricultural economy and help paint a picture of costs that farmers face as they negotiate rent levels for the near future.

Farm Real Estate Value

The U.S. average farm real estate value, a measurement that includes the value of all land and buildings on farms, clocked in at a record $3,380/acre. This 7% increase over last year represents a percentage change not seen since 2014 when values increased 8% over the previous year. In looking at the dollar value of the change, this is a $220/acre increase over 2020, a level not seen since 2012. These levels vary significantly throughout the country, with the highest real estate values concentrated in areas of the country with larger volumes of high-value crops (think wine grapes and tree nuts in California), as well as areas experiencing upward pressure due to proximity to urban areas. Much of the Midwest experiences higher levels of real estate values, followed by the South and Pacific Northwest, and finally the Plains and Mountain states. On a state-by-state basis, (excluding Northeast states with urban pressure), Nebraska, Kansas and Oregon all posted double-digit percentage changes over last year. These were followed by Texas, Iowa, California and South Dakota, each posting over 9% year-over-year growth.

 

Cropland Value

Like the overall real estate value, average U.S. cropland values posted sharp increases in 2021, rising to $4,420/acre. This increase came in as an 8% jump over 2020, which was the highest increase in cropland since 2013 when it jumped 14%. In dollar values, this year-over-year increase was $320/acre, also not seen since 2013. The distribution across the country follows a similar pattern as overall real estate value, with California and Northeast urban states claiming the highest average cropland values. Again, following that top category is much of the Midwest, followed by the South/PNW, and then the rest of the country. The top three states in terms of percentage growth are Kansas, Nebraska and South Dakota, posting gains of 13.9%, 13.8% and 11.9%, respectively.

 

Pastureland Value

Similar to overall real estate values and cropland values, pastureland values posted strong gains from the previous year, coming in at $1,480/acre on average for the U.S. This is an increase of 6% over 2020, the highest increase since 2014, and follows six years of little to no increases in value. However, the distribution of pastureland values across the country differs from the cropland value and real estate values. Instead of the Midwest and California, some of the more valuable state averages are concentrated in the South and the mid-South, with the Midwest and the Plains states making up the next group of higher average values.

 

Cash Rent Increases

NASS also recently released data on cash rents that farmers pay, and so far the strong increases in land values have not trickled down to cash rents. This tends to be more of a lagging indicator, and likely will be reflected in future negotiations that producers have with their landlords. Average U.S. cropland rent increased to $141/acre this year, an increase of 1.4% over 2020. Irrigated cropland rents increased 0.5% to $217/acre, while non-irrigated cropland rents increased 1.6% to $128/acre. Cash rents for pastureland held steady from 2020 to 2021, coming in at $13/acre this year.

 

Summary

Friday’s land value report from NASS showed sharp increases across the board in agricultural real estate values, cropland values and pastureland values. The average U.S. farm real estate value increased by 7% over 2020, while the cropland value and pastureland value increased by 8% and 6%, respectively. These increases are the sharpest in six or seven years, with little to no year-over-year increases in the last several years. The same pressures that are affecting many sectors of the U.S. economy appear to be impacting farmland values as well. These levels vary significantly throughout the country, with the highest real estate values concentrated in areas with larger volumes of high-value crops, as well as areas experiencing upward pressure due to proximity to urban areas. So far, the increases in land values have not yet been reflected in cash rents, with the national average cropland rent increasing by 1.4% compared to last year.

Success Stories

"We cannot say enough good things about Jesse. He helped us sell our farm land through an online auction process, and went above and beyond answering questions. He explained things in a way we could understand and kept us informed at every step in the process. Without hesitation we would recommend him to anyone!" The Steinke Family
"Hi Sherry We are very happy to inform you that we both have really enjoyed working with you and your company in the past two years. We are hoping to work with you again in the near future. Thank you so much for all your help and really appreciate everything that you have done from starting to end of this transaction. Please be safe in these tougher times. May God bless you! BTW, Please feel" E. Arige
"Hughes Real Estate went above and beyond in helping us get our aunt's property prepped and ready for sale. This included a house in town and farm land. They provided invaluable local expertise and were very professional and friendly. My family would recommend Hughes Real Estate with no reservations." Family of Millie H.
"Our family sold a fairly large parcel of farmland in Stevens County, Minnesota. It was a complicated property with different land characteristics and an existing CRP contract. We were very pleased with Jesse's representation. He had a lot of expertise and guided us through the different dynamics and options for selling the property. We highly recommend him." Jim J. and Karen H.
"Thank you for all you have done helping us sell our home, Sonia. It was a pleasure working with you! Best of luck in your future, you are an excellent realtor!" Mervin and Carole S.
"Sonia, Thank you so much for all you have done for us while we searched for the perfect home, with you we found it! We will refer you to everyone we know that is looking for a new home!" Jon and Missy R.
"Sonia, Thank you so much for the amazing job you did helping us find a home. You were very patient and listened to what we were looking for !" Mark and Karla H
"I was very satisfied with Sherry’s performance as my Realtor, everything was great on her behalf. Thanks again, Sherry!" Bob M.
"Jesse was our real estate agent when we decided to sell our home. He came to our first appointment well prepared with area statistics on houses for sale, houses similar to ours and helped us easily come up with a selling price. Jesse was able to answer all our questions with accurate information. He listed our house on a Thursday morning and had the first showing two days later. This showing resulted in the sale" Shawn and Holly Rodahl Benson, MN
"The synopsis of our experience is that we, either as individuals, or as a family would recommend and/or hire Jesse Hughes a heartbeat. He’s that good, and your experience with him will be top shelf from start to finish and beyond. He’s earned a glowing review from us and here is how; After the passing of our parents, we 5 siblings were beyond fortunate, and inherited the family farm, the “home place” if you will," Eileen F, Maxine B, Maureen B, Clif P, & Joyce S.