Farmland values in Ringgold county slipped back by less than one percent after increasing rapidly since 2002, according to the annual survey of farmland value conducted by Iowa State University.
While the average acre of farmland across the state showed a 2.84 percent decrease in value, Ringgold county farmland decreased at a slower rate, the survey said.
The average acre of farmland in Ringgold county is now worth $2,339, down from the all-time record of $2,361 set last year, a decline of .94 percent or $22.
The land value is 18.4 times the $127 an acre recorded in 1950 and more than six times the $386 recorded in 1986 when farm land values bottomed out after the previous run-up.
With the change, Ringgold county -- which had the second lowest farmland value in the state behind Decatur county for years -- remained ahead of several other counties passed in the past three years. Decatur county’s value was estimated at $1,957, the lowest in the state. Ringgold county remained ahead of Appanoose county with a $2,061 an acre value, Wayne with a $2,074 an acre value, Lucas with a $2,163 an acre value and Clarke with a $2,258 an acre value.
Ringgold county’s decline was down from last year’s 11 percent hike.
In terms of dollars, the county’s $22 an acre decline was one of the smallest in the state. Only 19 counties had increases or smaller declines than Ringgold county.
Allmakee county’s 5.65 percent increase of $166 was the largest increase in the state and one of only 11 counties that showed increases. Black Hawk county’s decline of 6.6 percent or $384 an acre was the largest loss in value in the state.
Land values in Ringgold county have now almost doubled over the past five years.
Across the state, the average value of an acre of farmland was pegged at a $4,371, down from the all-time record of $4,468 last year. With the average decrease of $97 an acre, the total value of the state’s 32.6 million acres of farmland is now $142.5 billion.
The decline was the first since the statewide average dropped in 1999, when the survey found the state average to be $1,781 an acre, or $20 less than in 1998. In the decade since 1999, farmland has increased in value by an average of 145 percent. The figure for Ringgold county is an increase of 226 percent.
In 2008 values in all 99 Iowa counties had topped $2,000 for the first time, but Decatur county slipped back below that mark in the latest value estimates. After breaking into $4,000 territory for the first time four years ago, the average value in Scott county this year was $6,361 an acre, an all-time record and the state’s leader. O’Brien and Sioux counties remained in the $6,000 or more an acre club. O’Brien county had a value of $6,153 and Sioux county a value of $6,028 per acre.
Surrounding county increases
In surrounding counties, there were decreases in value from 2.84 percent in Union county to just .09 of a percent in Taylor county. Union county remained in the lead in surrounding counties as the highest valued farmland.
The decreases in Adams, Taylor and Clarke county would have shown up as being greater, but the 2008 figures for these counties were revised downward to more accurately reflect the procedure used across the state, according to Mike Duffy, who did the study.
Adams county land prices were estimated at $2,764 an acre, down six dollars or $2,770 from the revised figure for 2008. Last year the estimate of value had been $3,094 an acre and, if that figure had stood, the decrease would have shown up to be much greater. The new average is still the second best on record. Lowest land value since 1950 came in 1954 with a price of $151 an acre. After reaching a high of $1,372 in 1981, land prices slipped to $519 in 1986 before rebounding to current levels. Land values have more than doubled over the last seven years there.
Clarke county land values slipped to $2,258 an acre this year, down $32 an acre or 1.42 percent from 2008, which was the previous record. The new 2008 figure was revised down from the $2,444 estimated last year. Lowest land value since 1950 was the $114 an acre recorded in 1954. The values in Clarke county reached a peak of $1,114 in 1981 before falling back to $399 in 1986 and then climbing to today’s levels. Land values in Clarke county have doubled over the last seven years.
In Decatur county, prices fell back to $1,957, according to the survey. This is a decrease of $45 an acre or 2.23 percent from $2,002 in 2008. The values in Decatur county reached a low of $91 an acre in 1954 before rising to $922 in 1981, then falling back to $326 an acre in 1986. Land values in Decatur county have doubled in the last seven years.
In Taylor county a total of $2,530 an acre was reported, down $2 an acre or .9 percent from last year’s record. Last year the figure from the report has been $2,733, which was revised down to $2,573 in this year’s study or the difference would have been much greater. Lowest land value since 1950 came in 1954 at $138 an acre. Prices there reached a peak of $1,203 an acre in 1981 before slipping back to $446 in 1986 and then rebounding to today’s prices. Land values there have doubled in the last nine years.
Union county land values were estimated at $2,826 an acre, down $83 an acre or a decrease of 2.84 percent from the record set last year. Lowest land value since 1950 came in 1954 at $141 an acre. Land values there received a peak of $1,433 in 1983 before falling off to $682 in 1986 and then rebounding to the new highs. Land values have doubled in the last seven years there.
Regional results
When looking at results across the south central Iowa crop reporting district which includes Ringgold county, the area had the third smallers percentage change in value and in terms of dollars per acre in the state.
Land in the area averaged $2,537 an acre, down $36 an acre or 1.4 percent from 2008.
The northwest area of the state edged out the central district to have the highest land values again. Values in the northwest district had average values of $5,364 an acre, ahead of the $5,026 recorded in the central district.
East central values jumped $53 an acre, the only part of the state where land values went up.
The accompanying chart shows other details about the changes in the crop reporting districts across the state.
When looking at land across the state by grade, low grade farmland fell 2.8 percent or $83 over the previous year to $2,884 an acre. Medium grade land averaged $4,076 an acre, a 2.8 percent or $119 an acre decrease. High grade farmland averaged $5,321 an acre, a decrease of $60 or 1.1 percent an acre.
Other survey results
In interpreting the results, Mike Duffy, ISU Extension farm economist who conducts the survey, said the indicators toward the end of the year imply the decrease in land values appears to have stopped, or at least stabilized. “For how long is unknown,” Duffy said.
Declines in land value reported on surveys earlier in the year show declines of as much as 7.6 percent.
The one area of the state where land values went up was the east central, where the 2008 flooding held down gains shown in other parts of the state last year.
Duffy said that recent trends in the value of Iowa land are not surprising given the relative change in the value of crops produced in Iowa over the past few years.
“The value of corn production in Iowa increased 64 percent from 2006 to 2007, but decreased 15 percent from 2007 to 2008, based on year-end summaries by the U.S. Department of Agriculture,” Duffy said. “The value of the soybean crop increased 40 percent two years ago and then decreased nine percent last year. Year-end reports are likely to show additional declines in total crop income, based on crop prices and the difficult harvest.”
The survey also found a major decrease in the amount of land sold during the past year. There were more than 60 percent of respondents reporting fewer sales than in 2008. The trend toward greater demand for higher quality land continued and there was also an increase in land being purchased by existing farmers, correlating with a decline in investor land purchases.
The south central part of the state, including Ringgold county, was where investor sales remained the highest. Some 32 percent of the sales in 2009 were said to be investor sales in this part of the state, compared to just 15 percent in the west central region of Iowa.
Positive factors for land value increases were listed as low interest rates, high commodity prices, high yields and a limited supply of land for sale.
Negative factors for prices included declining grain prices, high input costs and the poor general economy. Livestock losses of the past year and weather were other negative impacts listed.
Data on farmland sales has been collected by Iowa State University annually since 1941. About 1,100 copies of the survey are mailed each year to licensed real estate brokers, ag lenders and others knowledgeable of Iowa land values. Respondents are asked to report values as of November 1. This year 457 usable surveys were returned, providing 571 individual county estimates, including land values in nearby counties if they had knowledge of values in those counties.