Farmland values were mostly flat in 2024, holding steady at or near the record highs of recent years, reports Omaha-based Farm Credit Services of America (FCSAmerica). But it notes pockets of volatility in the real estate market in last half of the year signal a changing landscape as grain margins tighten, buyers become increasingly selective and more land auctions end without a sale.
Averaged across the four states served by the large farm lender, land values rose a modest 0.9% in the last half of 2024 and 1.6% for the year.
This slight uptick was largely attributable to one state, South Dakota, where producer balance sheets benefitted from above-average yields, it reports.
Iowa land values, by comparison, declined for the first time in five years. Iowa generally is on the leading edge of trends in the real estate market FCSAmerica comments.
Nebraska’s and Wyoming’s average land values were largely unchanged, although Wyoming market trends are difficult to identify because of limited sales activity.
FCSAmerica has the longest running and most comprehensive report on agricultural real estate values in its territory. The Association appraises its 63 benchmark farms every six months; many other land values reports are based on surveys.
The table below shows the average change in values for the benchmark farms, dating back to 2014. The parentheses indicate the number of benchmark operations in each state. Most benchmarks are cropland, but pasture or a combination of crop and pasture also are included.
| STATE | 6-Month | 1-Year | 2-Years | 5-Years | 10-Years |
| Iowa (21) | -2.80% | -5.10% | -4.80% | 52.60% | 38.60% |
| Nebraska (18) | -0.60% | -0.40% | 7.30% | 52.80% | 27.10% |
| South Dakota (22) | 5.70% | 9.50% | 18.10% | 64.60% | 40.50% |
| Wyoming (2) | 0.00% | 2.70% | 5.90% | 54.50% | 110.50% |
| Average Change (63) | 0.90% | 1.60% | 7.00% | 56.90% | 38.30% |
| Average per-acre $ (63) | $8,316 | $8,551 | $8,299 | $5,383 | $6,399 |
For the first time, FCSAmerica, AgCountry Farm Credit Services and Frontier Farm Credit have released a joint land values report that includes appraisals for 93 benchmark farms and ranches in all or parts of eight states. The Associations, which operate under a collaboration agreement, update appraisals for their respective benchmark farms every January and July.
In eastern Kansas, land values increased an average of 0.6% and 2.8% in the last half of 2024 and for the year, respectively. Minnesota, North Dakota and Wisconsin, with a combined 17 benchmark farms, saw no to little change during 2024.
| STATE | 6-Month | 1-Year | 2-Years | 5-Years | 10-Years |
| Kansas (7) | 0.60% | 2.80% | 17.00% | 54.10% | 52.70% |
| Minnesota (10) | 1.60% | 1.60% | 4.70% | 80.90% | 58.70% |
| North Dakota (11) | 0.80% | 0.80% | 8.30% | 73.20% | 71.40% |
| Wisconsin (2) | 0.00% | 0.00% | 14.80% | 30.80% | 38.00% |
Today’s real estate market is a changed landscape, FCSAmerica states. Interest rates are more historically normal than a couple of years ago, when rates were near or at record lows. Inflation, while down, has proved stubborn, permanently increasing input costs. And grain prices have declined, squeezing on-farm margins.
Jim Knuth, senior vice president of lending in Iowa, notes a softening of land values is to be expected in a compressed-margin environment, recalling that after the ethanol boom of 2012 and 2013, land values dropped for three consecutive years for an overall decline of 22% to 25%.
The surprise as agriculture enters another downturn “is how resilient land values have been.”
“The amount of cash still out there and the strength of balance sheets allow buyers to be both ‘in the market’ and fairly aggressive,” Knuth states.
Interest rates are not expected to have a significant impact on the market, Tim Koch collaborating association’s executive vice president, says. “Margins and availability of capital will play a more crucial role in influencing buyer behavior.”
Signs of a Downturn
While the market is stable overall, Koch, notes “instances of significant deviations in sales prices, both above and below expectations.”
Koch noted that while the real estate market currently is stable, “there are indications that we are headed toward a bit of a downturn.”
High quality ground in the right location continued to sell for higher-than-expected prices in 2024. “When it’s a really good farm and two neighbors with money decide they want it,” Koch said, “you still saw farms selling for more than expected.”
The market likely will see pockets of near to record high land sale prices into 2025, he said. But these sales will be the anomaly.
Knuth said buyers also are using appropriate levels of debt to retain adequate working capital for the size, risk and scope of their farm. Rather than an all-cash purchases, today’s buyers tend to invest enough cash to keep their loan payments to a sustainable level.