OMAHA, Neb. — There are more motivated land buyers in today’s market than there are willing sellers, according to Farmers National Company.

Despite the pressures created by lower net farm income, declining commodity markets, higher interest rates and increased input costs, land values have remained quite stable across the Midwest. While most university and industry land value reports published at year’s end reflect a flat or slight downward trend compared to production expenses, the stability in those values reveals the resiliency of the land market and its ability to maintain the high values set over the past five years.

“There are many factors for buyer motivation, but much of it can be explained by mindset translating to demand,” said Paul Schadegg, senior vice president of real estate operations at Farmers National Company. “Farm operators continue to be the primary buyers of ag land. Their mindset or motivation revolves around reinvesting in their farm enterprise, expanding operations, and utilizing today’s farm equipment fully. Location of land offered for sale also plays a large role in their decision making, as often this land has not changed hands for generations and once sold, may not be sold again.”

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Considering the average age of today’s farmers, most have experienced the rise and fall of farm cycles and, along with it, the long-term appreciation of land value. They fully understand what an exceptional value land presents as an asset to their farm operation and investment asset, Schadegg said.

“We anticipate that operating farmers will continue to be the primary land buyer as we move into 2025. Changes in the ag economy will determine if the percentage moves up or down,” he added.

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Land investors make up the second largest segment of ag land buyers. Investors include individuals, groups and land investment funds. Schadegg said that this group’s mindset is business-oriented.

“There is virtually no emotional motivation, as buying decisions are based on return on investment or anticipated appreciation of land value. The motivation lies in expanding the portfolio, opportunities in productive regions and improving ROIs in declining land markets. Many land investors have not experienced the rise and fall of agriculture cycles but fully appreciate the long-term value of land. As pressures on the ag economy increase, investors stand ready to bid on land that fits their investment criteria.”

Across the industry, land listings are down, on average, 25% from the active and accelerating value market experienced between 2020-2023. The principle of supply and demand fits into the current land market, as many landowners understand the long-term appreciation of land value while providing an annual return on that investment. Schadegg said that the result of this thought is to retain ownership, further reducing the amount of land offered for sale.

“Motivated buyers remain in the current land market both as farm operators and land investors ready to deploy available cash to further their operations or portfolios,” he added.

Farmers National Company has experienced an active fall selling season, marketing $223 million of land value for clients across the Midwest in the past three months. FNC conducted 123 sales through public auction methods. Real estate activity moving into the first quarter of 2025 remains brisk, with an above-average level of auctions and traditional listings being negotiated.

“Optimism remains moving into 2025, and with positive signals for the ag economy, opportunity will exist for those involved in agriculture production,” Schadegg noted.

South-Central Region: Kansas, Eastern Colorado, Western Missouri

According to Steve Morgan, area sales manager for Kansas, eastern Colorado, and western Missouri, agricultural profitability continues to be the main driver of the land market in this area.

“Land prices in southwestern Kansas have seen retracement, mainly irrigated land, due to the declining water availability in the area and the uncertainty surrounding GMD3’s future implementations of reducing allotments across the region. Eastern Colorado land prices have remained strong/stable with no marketable price decline,” Morgan said.

“Sales for top quality cropland irrigated and pasture remain strong with active buyer interest across the northwestern tier of Kansas counties. Central and eastern Kansas is seeing high demand for pasture and rec land, achieving top dollar. Crop land is highly dependent on location and local competition. We have maybe seen a price decrease on lower-quality properties in south-central Nebraska, but the high-quality properties have not seen the same decrease,” Morgan added.

Morgan added that the well-maintained, high-quality cropland in the western half of Missouri has not faltered either. Average cropland has been retraced in a 5-10% range. Morgan noted that recreation properties are still highly desirable, whether used in mixed use with crop acres or as pure recreation properties.

Western Region: Western Nebraska, Northwest Kansas, Northeastern Colorado

As the land market in central and western Nebraska, northwest Kansas, and northeast Colorado has settled over the past year, Cole Nickerson, area sales manager for the western region, says two consistent themes have emerged in recent sales.

“Neighborhood demand and land quality are the primary drivers in our area land market. Land values have remained high in regions with strong cattle production, driven by record beef prices. High-quality irrigated and productive dryland farms continue to command strong prices, reflecting recent trends. Quality grassland with good fences, ample water, and easy access have also maintained elevated prices,” Nickerson said.

“However, there has been a slight decline in values for land with productivity or access issues. Economic challenges in the corn and soybean markets have made farmland more difficult to sell in areas dominated by row crop production,” he added.

Recent sale highlights:

• 160 acres of Harlan County, Neb., dryland for $4,200 per acre
• 324.41 acres of Phelps County, Neb., irrigated land for $13,150 per acre
• 341.3 acres of Logan County, Neb., pastureland for $1,700 per acre
• 156.9 land values report from Farmers National Company now available four acres of Stanton County, Neb., dryland/recreational land for $9,500 per acre 

West-Central Region: Eastern Nebraska and Western Iowa

Land values in eastern Nebraska and western Iowa, for the most part, have stayed steady, especially for highly production farms or areas where there has been a limited supply of properties for sale, said Chanda Scheuring, area sales manager for the west-central region.

“But, as the agriculture economy finds less readily available cash compared to prior years, I think the buyer pool has shrunk. This has led to properties with lower tillable, or less productive, acres being the first to feel the pressure of higher interest rates and tighter profit margins. Over the past six months to a year, these types of property have seen a slight reduction in value (about 5-10%) from the recent market peaks,” Scheuring said.

“Buyers, both local farmers and investors, are still interested in making farm purchases; they’ve just become more selective in which properties to add to their portfolio and the price they are willing to pay. It’s why understanding the local market with the help of a trusted real estate professional is as important now as it’s maybe ever been,” she added.