Illinois land survey shows less concern about farm hardship, stronger outlook for land values
Key Takeaways
- •Only 3% of surveyed land professionals reported sales connected to farmers’ financial hardship, compared with 11% in last year’s survey.
- •Luke Worrell said respondents have largely reversed their view on interest rates and now do not expect lower rates.
- •Last year, 76% of respondents expected interest rates to fall, while this year 71% do not.
- •Forty-six percent of respondents said they expect farmland prices to be higher in two years.
A mid-year survey of Illinois land professionals produced several notable findings.
During a recent FarmDoc webinar, Luke Worrell of the Illinois Society of Professional Farm Managers and Rural Appraisers said the share of land sales tied to farmer financial hardship was relatively small, offering a snapshot of a market that appears less pressured than it did a year earlier.
“According to respondents, and these are people who are in the business, 3% were involved in a sale tied to farmers’ financial difficulties.” He added, “Last year when we did this, that was 11%. I think if you would have asked us last year, we would have predicted that almost would be higher.”
Worrell said the industry’s outlook on interest rates has also changed sharply, an important factor for land buyers and sellers because financing conditions can influence how active the farmland market feels.
“Last year at our mid-year, 76% expected lower interest rates, 71% this year do not.” He said, “Our responders have completely flipped. We pretty much do not expect lower rates.”
He also said 46% of respondents believe farmland prices will be higher in two years, making the survey more optimistic about land values than the past several mid-year surveys and giving a read on how professional appraisers and managers are thinking about the market’s near-term direction.
