April 11, 2022
The increased sale and auction activity in
the land market that we saw during the last quarter of 2021 continued
throughout the first quarter of 2022. Not only was there more land sold in the
past six months than the previous four years, prices also continued on the
strong upward trend the whole time. If a seller wanted to get the best sale
price for their land in this quickly up trending period, some type of
competitive bidding or auction was the best way to find out what the market was
willing to pay at any given time.
The number of auction type land sales
increased during the past six months compared to recent years. For
Farmers National Company, the number of auctions held increased 65% over last
year. The number of acres sold via auctions was up 106% and the dollar value of
auction sales was up 130% during the time frame. The number of auction sales
for the past six months was almost equivalent to what the company experienced
for a whole year during the slower land sales times of the past four years.
Not only were the number of land auctions up
the past six months, but sales prices increased dramatically into spring
planting time. A recent auction held by Farmers National Company of prime
farmland in central Illinois brought $21,500 per acre for 80 acres. Other
states and regions also experienced much stronger prices even from just the
first of the year.
The busy period of land sales during the fall
and winter months has come to a close, but auctions are still being held
through April and early summer, albeit at a much slower pace which is the
normal pattern. Time will tell if the higher prices will prompt more
landowners, mainly estates, trusts, recent inheritors, and some family groups,
to sell in the coming months. Time will also determine if the factors
supporting land prices will continue for the foreseeable future.
Randy
Dickhut
Senior Vice President - Real Estate Operations
Register online to receive email updates.