Land prices for the month of January 2022 rose overall for the properties that became available for purchase via land action, land listing, or off-market land purchases. The theme for the month was scarcity as we have more buyers looking for land for similar reasons from the past year than ever. The buyers categorized as “investors” were very active due to increased real estate values elsewhere creating many 1031 exchange buyers looking to buy land for its simple management reasons, as well as increased timber/cropland cashflow and values to name a few. We also had many cash and financed local buyers purchase hunting land, buildable land, and cropland tracts for personal use or to rent out.
Seller motivations for the month were primarily sellers that were taking advantage of the high prices of land that have had an interest in selling for some time and decided now has looked like a better time than ever. Multiple sellers over the month have had their land for sale privately or with other firms without buyer interest and were welcomed with many showing and multiple offers after their property was marketed and exposed correctly at High Point, sometimes even higher than their previous listing prices. In this market simple exposure is not enough to find great buyers and many of them at once. A property must have excellent high quality marketing, accompanied by a story, and a marketing plan to ensure all buyer types see the property or are motivated to purchase at today’s new High Points. Another important part is a land agent that understands financing and has relationships with leaders that can get land deals financed to successfully close the transaction.
Down to prices. Much of the farmland that becomes available for purchase today is being sold at auction to ensure the highest price is achieved in the shortest amount of time for the sellers and buyers to feel comfortable with competitive bidding. Farmland is measured in quality based on many factors, however a large one being CPI/CSR2 or named soils that buyers are familiar with and know what types of crops and yields can be expected to be productive and in turn profitable. Land prices in MN, IA and WI are trading conservatively in the 130-250+/CSR2 and 110-140+/CPI point depending on many factors and sale methods. Woods, hunting land or timber land is selling for $4000-7500/ac+ again based on quality, location, water, access, and buildable opportunities to name a few. Land in Colorado is selling for a very wide range due to not only its use but its availability for use or access water. Much of the hunting land in the state is selling between $2000-$5000/ ac depending on the quality and area as well as the access and potential deed restrictions that may reduce interest in or use of the property.
If you are interested in selling or buying land this is a great time to do so for many reasons on both sides of the coin. If you have questions regarding the market, financing, cashflow or anything pertaining to land give one of our qualified agents a call today. They are an excellent resource that love talking land.
