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| The reason for not buying more land in this area was : Farmers were losing money on every acre they farmed many were do some kind of off farm income or were to old to do that. When every acre you farm cost you out of pocket money -- you don't buy more.
Land prices peaked here in 1981/1982 at $1600 per acre bottomed in 1986/1987 At $350 per acre , in 2002 I bought a half section for $980.00 per acre and passed on another half section that sold at $1075.00 per acre. Land prices here jumped back above the the 81/82 high in 2004/2005.
the 10 years were you claim land went from 450 to 1500, were not filled with profits in farming from 1985 until 1989 corn spent more time below $2.00 per bushel than above, the 1988 drought took away an lot of excess product but did not put much on the farmers bottom line , hell in 1994 we still had sub $2.00 corn. by the time profits started showing up in farming most farmers needed to upgrade 45 year old equipment and found that to be a better investment than buying every acre that came up for sale.
Fed fund rates were still around or above 9% in 1990
rarely does land show a reasonable ROI let alone a great one, but the key is to not buy poor ROI on land after record income years, If you buy land at its peak with an ROI of 1% what will the ROI be on that land when if drops to 1/3rd of its value and stays there for 20 years?
This is my experience on how farming has went in my area in my lifetime, make NO mistake farmers always want to buy ground, but more simply want to farm the next year, most that are farming actively today can only be told of long ago stories of a time when that was not the first thoughts on their minds.
Edited by SodbusterIII 4/17/2024 08:11
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Crazy Land Auction
