Reading a recent report on agricultural land prices, I continue to be amazed at the increases that are reported. While I realize that prices in my corner of the world don’t begin to approach those where the soil is deep, rich and productive for grain crops, I wonder where, and when, the limit will be reached.
In 1955, my parents purchased the farm on which I was raised for a little less than $50 per acre. I can still remember my father being worried he had paid too much for the 216 acres and struggling each year to make the payment. With hard work, milk cows and favorable hog prices, he had it paid off in five years.
In 1985, my new wife and I purchased our first farm (the same one we live on today) for a little less than $500 per acre. I can still remember worrying we had paid too much for the land and wondering if we could ever get it paid off. Each additional farm we were able to purchase over the next 20 years always cost quite a bit more than the previous one, but we kept buying. With each new purchase, I agonized I had overpaid, fretted I wouldn’t be able to make the payments, and brooded about land prices that just had to stop rising… someday. They haven’t.
Land prices were the topic of conversation at the feed store last week when one of my neighbors expressed disbelief about a recent local transaction. A small farm, with no improvements, less than average fencing, and typical pasture condition for this area, had sold for $6,000 per acre.
“How is that even halfway reasonable?” he asked.
Another neighbor added fuel to the fire by informing everyone another old farm, about 8 miles from where we live, had recently been surveyed and divided into 5-acre plots. The owner was going to market them as building sites for “farmettes in your little slice of the countryside” for $12,000 per acre.
The old neighbor, who had been appalled by the $6,000 price, now seemed in danger of having a stroke.
“I tell you this,” he began, “if somebody comes along, out of the clear blue, and offers me $12,000 per acre for my farm, I’ll sell them every square inch so quickly, they won’t be able to write the check fast enough.”
Looking around the store at the rest of us, he added, “Wouldn’t you do the same?”
One of our shrewdest neighbors pondered the question, then replied, “If someone offered me $12,000, they might be willing to go $13,000.”
Jerry Crownover farms in Lawrence County. He is a former professor of Agriculture Education at Missouri State University, and is an author and professional speaker. Jerry’s daily exploits on the farm are now viewable on YouTube at “lifeissimple678”. To contact Jerry, go to ozarksfn.com and click on ‘Contact Us.’
