AMARILLO, Texas (May 24, 2022)– Although farmland value continues to rise across the U.S., the threat of rising interest rates and other economic pressures have the potential to create headwinds that may stall or reverse that upward trend.
If you’re considering selling a farm or ranch in the near future, now may be a good time to act, to take advantage of current high prices and strong interest in agricultural land. And choosing a land auction over a traditional listing should help you obtain the top price.
“Land values have climbed considerably, and land sales matched that growth,” says JT Haynes, president of Superior Land Auction. “If you expect to be selling land, it’s a smart move to look at the significant advantages that a land auction can bring you this year, while the market and buyer demand are still strong.”
A recent survey conducted by the Federal Reserve of Kansas City showed farmland values increased at a rapid pace through the end of 2021, supported by strong demand, historically low interest rates and improved conditions in the farm economy.
With rising interest rates this year, however, along with surging inflation and global economic pressures, many experts see the potential for the land market to slow, particularly after 2022. In addition, in the Federal Reserve survey, more than 50% of banker respondents indicated that farmland values were currently overvalued, suggesting there might be future risks of declines.
“Selling your land in an auction in today’s strong market helps position you to get the best value,” says Haynes. “There is still growing demand for farmland from farmers, non-farmers and outside investors. An auction is a more finite sales approach, with the seller knowing the exact date when the sale will take place and the auction broker strategically marketing the event to generate more buyer engagement and competition.”
Haynes notes that, with an auction, the seller chooses the sale date, and can better plan accordingly for other investments, financial goals or lifestyle changes, as well as eliminate ongoing carrying costs like interest, taxes, maintenance and continued depreciation. Also, in most Superior Land auctions, buyers pay surveying and title costs, which lowers costs for the seller.
Superior Land Company specializes in auction services nationwide that help agricultural landowners have the best seller experience and achieve the highest sale price.
“Just as our affiliate company, Superior Livestock Auction, specializes in livestock auctions, we have the experience and industry connections to successfully conduct land auctions for farmers and ranchers nationwide better than anyone else,” says Haynes. “Our commitment is to be the leader in land auctions for farmers and ranchers and to get them top dollar.”
