Hungry?? Just Wait

This increase in land values back in the cornfield is dramatic the biggest one year increase in over three decades. Increases such as this cannot be sustained and there will be consequences similar to inflated home prices. These guys get dollar signs rolling in their eyes at times and this is one of them. The economy crashed before in the 70’s when farmers encouraged by the feds to expand their operations with easy money. They did and many went bust forever changing who owned what. It is a bit different this time in that some of these guys are paying cash for land.

On 4/07 wrote this about how much land values had jumped and that an acre of land was selling for $4000 an acre and we thought that was an amazing number.

The part of the cornfield I come from land now sells for at least $8000 an acre and sometimes more. Friends who own land say and this is not a stretch at all that if they told someone in the morning they were going to sell land when they come in the afternoon they wouldn’t be able to get in their driveway because so many want it. I think my one friends land would sell for 9K an acre and maybe more.

Eventually this will all come crashing down as numbers such as this cannot be sustained. The linked to article is a wealth of information.

Fueled by increases in livestock and corn prices, the value of Iowa farmland jumped 24.5 percent since March 2010 — the biggest annual increase in more than three decades. A survey by the Iowa Farm and Land Chapter No. 2 of the Realtors Land Institute shows the average value of all tillable cropland in the state as of this month was $5,708 per acre.

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