Iowa Public Television

 

Rural Land Values Soar to Record Highs

posted on August 8, 2008


Hello, I'm Mark Pearson. In what was viewed as a bright spot for the beleaguered economy, the government reported this week that orders to U.S. factories grew dramatically earlier this summer.

According to the Commerce Department, factory orders rose by 1.7 percent in June, in their best showing since last December.

The news, coupled with a decision by the Federal Reserve to leave interest rates unchanged, boosted optimism on Wall Street, where the Dow soared more than 300 points in its biggest single-day gain since April.

Investor sentiment also was buoyed by the continued drop in crude oil prices, which fell to $115 per barrel this week and are now more than $30 below record highs posted in July.

Despite the downward trend, crude oil is still up more than 50 percent from last August. But energy isn't the only sector of the economy where prices are on the rise. This week, the Agriculture Department reported the value of U.S farm real estate has soared to an all-time high.

Rural Land Values Soar to Record Highs According to USDA, The national average of $2,350 per acre is up nearly 9 percent from last year and is double the amount land brought in 2000.

Nationally, croplands are worth a record $2,970 this year, up 10 percent from 2007. Cropland values in Ohio, Indiana, Iowa and Missouri rose nearly 15 percent at $4,260 an acre. The largest gains were found in the Northern Plains, where values increased more than 15 percent to just over $1,100 an acre.

Rapidly appreciating real estate is fueling significant hikes in rental rates as well. Nationally, cropland cash rent rose 13 percent to $96.00 per acre. The largest increase was found in the Mississippi Delta Region, where rates increased more than 20 percent from last year. Average cash rent in the Corn Belt increased more than 10 percent to $140.00 per acre. And in the Northern Plains the figure climbed to $64.00 per acre.

USDA says strong commodity prices, favorable interest rates and tax incentives are

Tags: news real estate rural