Lincoln, Neb. —The value of agricultural land in Nebraska increased by an average of 6% over the prior year, to a statewide average of $2,895 per acre, according to the preliminary findings of the University of Nebraska–Lincoln’s 2021 Farm Real Estate Market Survey. This marks the second consecutive year that agricultural land in the state has experienced an increase in average market value.
Land industry professionals who responded to the survey attributed the rise in Nebraska farm real estate values to current interest rate levels, crop prices and COVID-19 disaster assistance payments provided to operators across the state. These factors provided stability to the industry in the face of an economic shutdown and disruptions of supply chains.
“During periods of economic uncertainty, monitoring Nebraska farm and ranch real estate remains important to understanding how financial forces are impacting agricultural land markets across the state,” said Jim Jansen, an extension educator who co-authored the survey and report with Jeffrey Stokes, a professor in the Department of Agricultural Economics.
The preliminary report found that center pivot-irrigated cropland estimated values rose by about 8% across the state. Dryland cropland values rose by about 6%. Survey participants noted higher crop prices as a major force leading to higher cropland values across the state. Improvements in grazing land and hayland market values range about 3% to 5% higher than the prior year.
Survey results also revealed that rental rates for cropland and grazing land in the state have increased by an average of about 5% to 7% for cropland, while rates for pasture and cow-calf pairs saw an average increase between about 3% and 7%. Survey participants also reported that the late season runup in crop prices were a major factor leading to higher cash rental rates in 2021.
The Nebraska Farm Real Estate Market Survey is an annual survey of land professionals, including appraisers, farm and ranch managers and agricultural bankers, conducted by the Department of Agricultural Economics. Results from the survey are divided by land class and agricultural statistic district. Land values and rental rates presented in the report are averages of survey participants’ responses by district. Actual land values and rental rates may vary depending upon the quality of the parcel and local market for an area. Preliminary land values and rental rates are subject to change as additional surveys are returned.
The preliminary report was released in the Department of Agricultural Economics’ weekly Cornhusker Economics newsletter. Its findings will be discussed in a webinar at noon March 18. To register for the webinar and read the report, click here. Final results from the survey are expected to be published in June.