Each year since 1991, South Dakota State University Extension has conducted an Agriculture Land Value Survey to provide South Dakotan's with an unbiased look at average land values and rental rates across the state.
"For a market economy to be efficient, information is important. When we are talking economics, that information is prices; and prices are what this survey provides," said Kim Dillivan, SDSU Extension crops business management field specialist.
Dillivan said the 2014 survey data showed a trend change in land values and rental rates across the state.
"Overall, while land values and rental rates are up from last year, 2014 results show some of the lowest increases compared to recent years," he said. "Percent-wise, the increases were only in the single digits. Whereas, in each of the last three years surveys showed increases around 15, 20 or 30 percent."
He said the small increase in agriculture land value and rental rates is most likely related to price declines in the 2013 corn, soybean and wheat markets. Small increases in values and rents might also be related to the fact that alternative investments are available.
"We know that individuals who don't farm or ranch buy South Dakota land as an investment. Now that the housing market has come around and the stock market has improved, we speculate investors are looking to invest in other areas," Dillivan said.
More on the survey
The Agricultural Land Value Survey includes price information on land used for crops, hay, pasture and forage. It includes average sale prices as well as rental rates. To gain a clear and unbiased picture of South Dakota land values, SDSU Extension surveys individuals from across the state; from realtors, lenders, appraisers and assessors to farm managers, SDSU Extension personnel and USDA Farm Service Agency staff. This year's survey included feedback from 224 individuals.
"Providing unbiased information is always our focus. We believe the folks we interview have good knowledge and no reason to over or under value their responses," Dillivan said.
Once survey information is gathered, Dillivan helps review the data and calculates averages for eight regions and each county or county cluster throughout South Dakota.
The 2014 survey results are complete and now available on iGrow.org. Dillivan has also written a seven-part series delving into more detail on the survey's results. This series can also be found on iGrow.org.