The market value for farmland in the Cornhusker state dropped again in 2019. The average per-acre value is $2,650—a drop of 3% from 2018, according to the preliminary results of the 2019 Nebraska Farm Real Estate Market survey. This marks the fifth consecutive year of lower values.
Overall, Nebraska farmland prices have dropped 20%, since reaching a high of $3,315 in 2014.
Long-Term View of Nebraska Average Land Values
In the Southwest district of the state, farmland values posted a 6% year-over-year drop—the largest of any district. The South and Northwest districts each declined by 4%, followed by the Northwest and North, where values each dropped by 3%. The Central and Southeast districts show 2% year-over-year drops, while the East district declined by only 1%.
All of the seven land classes dropped in value, compared to last year:
- Dryland Cropland (No Irrigation Potential): -2%
- Dryland Cropland (Irrigation Potential): -3%
- Grazing Land (Tillable): -4%
- Grazing Land (Nontillable): -4%
- Hayland: -3%
- Gravity Irrigated Cropland: -1%
- Center Pivot Irrigated Cropland: -2%
Survey participants pointed to current trade issues and property tax policies as the two most negative forces driving farm real estate values down, says Jim Jansen and Jeff Stokes of the University of Nebraska.
Softer Rental Rates
Rental rates for cropland and grazing land in 2019 showed gradual declines for most land classes. Average cropland rental rates for irrigated and dryland production reported declines ranging from about 1% to 5% across the state, while a few districts saw increases of 2% to 5%.
Pasture and cow-calf pair rental rates were mixed to steady depending upon the district. Most regions saw declines of 2% to 7%, while other areas saw increases from 1% to 5%.
“Many absentee or retired landowners appear to have rising property tax liabilities while trying to achieve a positive return on their assets,” Jansen and Stokes report. “Agricultural operators seeking to produce commodities above breakeven prices face tight margins with low prices.”
This annual survey, conducted by the University of Nebraska-Lincoln, polls appraisers, farm and ranch managers and agricultural bankers. Final results from the survey will be published in June 2019 at http://agecon.unl.edu/realestate.