2015 Farmland value trends in Wisconsin
Arlin Brannstrom, Center for Dairy Profitability
Extension Farm Management Specialist
UW-Madison College of Agricultural and Life Sciences
Phone (608) 265-3030
2:56 – Total Time
0:19 – Five percent increase in land prices
0:35 – What influences farm land prices
0:59 – Farm land values vary by location
1:29 – Price ranges from place to place
2:01 – Buy land carefully
2:32 – Price land accordingly
2:47 – Lead out
Sevie Kenyon: Trends in Wisconsin farmland prices. We’re visiting today with Arlin Brannstrom, Center for Dairy Profitability, University of Wisconsin-Madison in the College of Agricultural and Life Sciences and I’m Sevie Kenyon.
Arlin, what are you seeing in Wisconsin farmland prices this spring?
Arlin Brannstrom: We just finished the 2014 analysis of sales between unrelated parties and we see the average agricultural property in the state has been running around $3900 an acre. That’s up about 5 percent from where it was last year at this time.
Sevie Kenyon: Arlin, what kind of things affect farmland prices?
Arlin Brannstrom: Obviously there’s many factors that can drive a specific sale higher or lower. Some of the things that are probably most important to a producer are proximity to an existing land base; competition between other farmers in the area; certainly land prices are also affected by interest rates.
Sevie Kenyon: Arlin do you see any differences from one place in the state to the other in land prices?
Arlin Brannstrom: Absolutely, as you go from the east, southeastern corner of the state to the farther west parts of the state, the prices of ag land go down. Likewise, as you go farther north the quality of the ag land gets a little bit poorer, you’ll see some lower prices as well. The most valuable land in the state is probably in the northeast corridor near Green Bay and Oshkosh, as well as down in the southeast as you would expect with the large population demands for land in that area as well.
Sevie Kenyon: What kind of numbers are you seeing?
Arlin Brannstrom: These numbers range from in that Green Bay/Appleton area the prices are in the almost $6000 range. Likewise in the southeast corner of the state they are also in that $6-7000 range. About 20 percent of the sales in the state were under $2000 an acre. Often you hear about the high price sales. Less than 20 percent of the sales were over $6000 an acre. So that makes quite a difference.
Sevie Kenyon: What should people do if they’re interested in buying additional farmland?
Arlin Brannstrom: Well, there’s always going to be people interested in buying for expansion purposes. I think it would be a real good time to do some careful budgeting, especially with the falling commodity prices. Both corn, beans and now milk makes it very difficult to take on the financial commitment of adding acreage to the farm. So careful budgeting is probably the first thing I would recommend.
Sevie Kenyon: How about on the other side of the equation, Arlin, if someone has land to sell what should they be thinking about?
Arlin Brannstrom: You probably want to be working with an appraiser to get an opinion of value that’s a fairly accurate reflection of what the market in that area is. We can do statewide averages, but that’s not really what you would want to use to set an asking price for your land.
Sevie Kenyon: We’ve been visiting with Arlin Brannstrom, Center for Dairy Profitability, University of Wisconsin-Madison in the College of Agricultural and Life Sciences and I’m Sevie Kenyon.