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Crop land price bouncing back

Elizabeth Williams
DTN/The Progressive Farmer photo by Jim PatricoA 2,500-acre farm in the Nebraska Sandhills doubled its value in two years and attracted $1,000 per acre more than expected.

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INDIANOLA, IA (DTN) – Farmland brokers report strong interest in top-quality farmland and expect steady to higher prices for 2010.

At a farmland auction in the Nebraska Sandhills on Nov. 5, attendees shook their heads in disbelief at the closing bid on a 2,500-acre irrigated farm with a large grain drying and storage facility.

Thirty-eight potential buyers had come to bid, but it came down to three bidders when the whole farm was combined. Bids jumped from $9.6 million to $12.7 million within five minutes. At the end, a Minnesota farm family bought the land for about $5,650 per irrigated acre – an average of $5,300 per acre for total acreage – including an elevator with two million bushels of storage and 2,000 additional leased crop acres.

The owners of the land had bought it only two years ago. When the dust settled on that super-charged auction, they had doubled their money.

“It brought $1,000 per acre more overall than we expected,” said Patrick Chohon, owner of Waldo Realty in O’Neill, NE, who was in charge of the auction.

Real estate broker Jon Hjelm with Acre Company in Spencer, IA, noted the change in buyer attitude. “Earlier in 2009, we had a threat of higher interest rates, and the cost of production was skyrocketing and people were uncertain of where agriculture was heading.”

Now, Hjelm said, buyer confidence has returned with good crops and some good prices. He reported northwest Iowa farmland sales in December and January from $6,000 to $6,750 per acre on top land in Clay County that produces an average 220 bpa corn.

INDIANOLA, IA (DTN) – Farmland brokers report strong interest in top-quality farmland and expect steady to higher prices for 2010.

At a farmland auction in the Nebraska Sandhills on Nov. 5, attendees shook their heads in disbelief at the closing bid on a 2,500-acre irrigated farm with a large grain drying and storage facility.

Thirty-eight potential buyers had come to bid, but it came down to three bidders when the whole farm was combined. Bids jumped from $9.6 million to $12.7 million within five minutes. At the end, a Minnesota farm family bought the land for about $5,650 per irrigated acre – an average of $5,300 per acre for total acreage – including an elevator with two million bushels of storage and 2,000 additional leased crop acres.

The owners of the land had bought it only two years ago. When the dust settled on that super-charged auction, they had doubled their money.

“It brought $1,000 per acre more overall than we expected,” said Patrick Chohon, owner of Waldo Realty in O’Neill, NE, who was in charge of the auction.

Real estate broker Jon Hjelm with Acre Company in Spencer, IA, noted the change in buyer attitude. “Earlier in 2009, we had a threat of higher interest rates, and the cost of production was skyrocketing and people were uncertain of where agriculture was heading.”

Now, Hjelm said, buyer confidence has returned with good crops and some good prices. He reported northwest Iowa farmland sales in December and January from $6,000 to $6,750 per acre on top land in Clay County that produces an average 220 bpa corn.

INDIANOLA, IA (DTN) – Farmland brokers report strong interest in top-quality farmland and expect steady to higher prices for 2010.

At a farmland auction in the Nebraska Sandhills on Nov. 5, attendees shook their heads in disbelief at the closing bid on a 2,500-acre irrigated farm with a large grain drying and storage facility.

Thirty-eight potential buyers had come to bid, but it came down to three bidders when the whole farm was combined. Bids jumped from $9.6 million to $12.7 million within five minutes. At the end, a Minnesota farm family bought the land for about $5,650 per irrigated acre – an average of $5,300 per acre for total acreage – including an elevator with two million bushels of storage and 2,000 additional leased crop acres.

The owners of the land had bought it only two years ago. When the dust settled on that super-charged auction, they had doubled their money.

“It brought $1,000 per acre more overall than we expected,” said Patrick Chohon, owner of Waldo Realty in O’Neill, NE, who was in charge of the auction.

Real estate broker Jon Hjelm with Acre Company in Spencer, IA, noted the change in buyer attitude. “Earlier in 2009, we had a threat of higher interest rates, and the cost of production was skyrocketing and people were uncertain of where agriculture was heading.”

Now, Hjelm said, buyer confidence has returned with good crops and some good prices. He reported northwest Iowa farmland sales in December and January from $6,000 to $6,750 per acre on top land in Clay County that produces an average 220 bpa corn.

INDIANOLA, IA (DTN) – Farmland brokers report strong interest in top-quality farmland and expect steady to higher prices for 2010.

At a farmland auction in the Nebraska Sandhills on Nov. 5, attendees shook their heads in disbelief at the closing bid on a 2,500-acre irrigated farm with a large grain drying and storage facility.

Thirty-eight potential buyers had come to bid, but it came down to three bidders when the whole farm was combined. Bids jumped from $9.6 million to $12.7 million within five minutes. At the end, a Minnesota farm family bought the land for about $5,650 per irrigated acre – an average of $5,300 per acre for total acreage – including an elevator with two million bushels of storage and 2,000 additional leased crop acres.

The owners of the land had bought it only two years ago. When the dust settled on that super-charged auction, they had doubled their money.

“It brought $1,000 per acre more overall than we expected,” said Patrick Chohon, owner of Waldo Realty in O’Neill, NE, who was in charge of the auction.

Real estate broker Jon Hjelm with Acre Company in Spencer, IA, noted the change in buyer attitude. “Earlier in 2009, we had a threat of higher interest rates, and the cost of production was skyrocketing and people were uncertain of where agriculture was heading.”

Now, Hjelm said, buyer confidence has returned with good crops and some good prices. He reported northwest Iowa farmland sales in December and January from $6,000 to $6,750 per acre on top land in Clay County that produces an average 220 bpa corn.


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