Local farmland values drop for third straight year

AMES — Butler County farmland values saw a sharp decline for the third straight year in 2016, a survey released last week by the Iowa State Extension states.
Values in Butler County declined to an average of $7,596 per acre, a drop of 6.2 percent from the 2015 survey. Land values were determined by the 2016 Iowa State University Land Value Survey, which was conducted in November by the Center for Agricultural and Rural Development at Iowa State University and Iowa State University Extension and Outreach. Wendong Zhang, an assistant professor of economics at Iowa State University, led the annual survey.
“The golden era of phenomenal, yet abnormal growth in farm income and land values, as we saw from 2006 to 2013, is already behind us,” Zhang said in a press release. “The land market is going through an orderly adjustment while the U.S. agricultural sector, a competitive industry, is trying to adjust to the old normal of zero industry-wise net profits. For a pessimist, there are reasons to worry, especially for landowners and/or producers who are overleveraged. For an optimist, this decline is still modest, and the probability of a replay of the 1980s farm crisis is low.”
Read the full article in the December 22 edition of the papers.