| MT Farm Real Estate Values UP
Montana and US Farm Real Estate Values Up
September, 25, 2006 Trade Winds Newspaper, Jordan, MT
The average value of farm real estate in Montana on January 1, 2006, was $760 per acre, up $250 from 2005, according to USDA, National Agricultural Statistics Service, Montana Field Office. The average value of cropland rose $194 to $846 per acre, compared with a year ago. The average value of irrigated cropland was $2,800, and increase of $800 from a year ago, while non-irrigated cropland gained $140 per acre to $630 per acre. Pasture values increased $280- to $650 per acre. Montana farm real estate values have been steadily increasing over the past seven years.
US farm real estate values, a measurement of the value of all land and buildings on farms, average $1,900 per acre on January 1, 2005. Cropland values averaged $2,390 per acre and pasture values averaged $1,000 per acre on January 1, 2006, compared with $2,100 and $820 per acre, respectively, a year earlier.
The increase in farm real estate values continues to be driven by a combination of mostly non-agricultural factors, including relatively low interest rates and strong demand for non-agricultural land uses. Demand for farm real estate as an investment continues to be a strong market influence.
Regional increases in the average value of farm real estate ranged from 8.9 percent in the Delta region to 35 percent in the Mountain region. The highest farm real estate values are in the Northeast region, where urban influences have pushed the average value to $4,500 per acre. In the Corn Belt region, farm real estate values rose 12 percent to $3,040 per acre. The Northern Plains region, with its expanse of pasture and rangeland, had the lowest farm real estate value, at $834 per acre.
The Southeast region had the highest average increase in cropland value, at $4,550, up $890 per acre. In the Corn Belt region, cropland values rose 12 percent, to $3,230 per acre. The Lake States region also increased 12 percent. Together the Corn Belt and Lake States regions account for nearly one-third of the US total cropland acres.
The Southeast region had the highest average increase in pasture value, up $1,510 per acre. In the Northern Plains, Southern Plains, Mountain and Pacific regions (17 western states) pasture values per acre increased 15 percent, 24 percent, 54 percent, and 13 percent respectively. Together the 17 western states account for about 69 percent of the total pasture acres on farms in the 48 states.
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