Nebraska Farmland Values Continue to Decline

Results from the Nebraska Farm Real Estate Survey show a statewide average value drop of 4 percent to $2,720 per acre. This marks the fourth consecutive year of declining Nebraska agricultural land values.

Results of the survey are divided by land class and summarized by eight Agricultural Statistic Districts of Nebraska. Respondents of the annual survey included consisted Nebraska land professionals including appraisers, farm and ranch managers, and agricultural bankers.

In the seven land classes, tillable grazing land values dropped by seven percent, the largest of the group. Survey participants suggested that crop prices and property tax levels are the reason for the declining Nebraska farm real estate values.

“The fourth consecutive year of declining Nebraska agricultural land prices reflects the steady year over year reduction in farm income resulting from lower commodity and cattle prices combined with yearly increases to property taxes,” explains Hertz Farm Manager Scott Henrichsen. “We’re going to see a continual decline in land values so long as farm income for Nebraska farmers remains low with 70% of all farm land purchased each year by existing farmers and ranchers. Taxes are too high to incent investors and farm income too low with credit too tight for farmers to be aggressive with their land purchases.”

Earning potential for the major commodities grown across the state, input expenses, and monetary policies influencing the cost of borrowing for future land purchases, will all affect future prospects in Nebraska.