Farm prices holding steady into 2023

By Matt Reese

For many, a noteworthy discussion topic in 2022 has been the aggressive increases in interest rates. While this surely has impacted some markets, Doug Walton, with United Country Walton Real Estate & Auction Co., LLC has not seen it. 

“It has brought up a lot of questions, but interest rates really have not affected the land market because we’re continuing to see it stay steady to higher as we move right along going into 2023. There still seems to be a lot of guys out there hunting for land and if they want it and have some cash down, they’re definitely going for it. There’s so much demand out there and there’s still old money in some of these farming communities. Farmers are still buying the land as opposed to investors. Not that investors aren’t buying some of it, but not at the pace of what farmers are. We had one farm here up northeast of Tiffin that, with the buildings figured in, was in the $10,600 per acre range. Without the buildings, it was $12,000 per acre for the farmland. I know some of the banks ‘oooh’ and ‘ahhh’ about those prices, but they keep going strong with their loans,” Walton said. “The interest rate doesn’t seem to be affecting much machinery either, because there is nothing on these dealer lots. Good used machinery is bringing a premium price. Even some just average machinery is still bringing premium prices.”

Walton’s business, started in 1951, is based in Upper Sandusky and he regularly is working in the 6 to 8 surrounding counties and occasionally all around the state. There are also branches in Bellevue, Galion, and Centerburg. In addition to tillable acres, he has noticed continued strong value for wooded parcels in spite of rising interest rates.

“We had an auction for a family which included an old homestead and the buildings and we sold the grain bins separate and then we had five or six tracts of woods, 12 acres being the largest. The sellers were under the impression they could get $7,000 or $8,000 and I told them there was no timber value to the woods and that would have an effect. But then we did the auction and you would have never known that there wasn’t much value in the timber, because we got more than $10,000 an acre on these wooded tracts,” Walton said. “There’s still a lot of demand for folks coming out of the city who want a piece of dirt or woods just to go to have a recreational weekend with their camper out in the country or just have a place to go and hunt some deer. We’ve still seen great demand for these leisure properties.”

Moving into 2023, Walton sees land and equipment values holding strong.

“On the buyer front I think they still need to look at their budgets and stick with them because it’s easy to get caught up in the adrenaline rush in an auction. You see somebody else sitting right alongside you and think, ‘If they can spend that then I can too.’ Then you go tell your banker 2 days later you need to another $1,000 or $2,000 an acre and he starts swallowing harder because he’s not sure that the appraisal will come in where the farm was bought. In those cases, the buyers need to make sure they’ve got enough money down,” he said. “I think the market looks good clear through corn planting time again in April. I see nothing to really put the values lower at this point. In a year from now, who knows, but grain prices have been good and parts of the state have had exceptional yields. For our area here, this is 3 years in row that we’ve had super crops and good prices too.”

For more about United Country Walton Realty & Auction Co., LLC, visit ucwaltonrealtyandauction.com/featured-properties.