People buying and selling Iowa farmland have been on a roller coaster ride the past 30 years. It has made some cheer and others sick.
For most of the past decade, prices have steadily climbed. Reports indicate values soared by about 24 percent this year.
Goodness gracious, I can’t take a breath because it keeps going up,” said Dave Hommel, an Ivester farmer describing recent land auctions he has attended.
A year ago, Hommel paid $9,000 per acre for a 60-acre tract.
Landowners have been on this ride before.
Farmland more than quadrupled in price from 1971 to 1981. A sharp descent followed, the primary cause of the farm crisis in the mid-1980s. It is considered the worst time in agriculture since the Great Depression. Forced farm auctions in the Cornbelt were common.
There is fear among farmers and ag experts it could happen again.
“Maybe not as prolonged, but in two years we could have another crash. Paying $10,000 to $15,000 an acre for ground will come back to bite you. I’m fairly confident about this,” said Larry Depping, a Reinbeck farmer.
Many economists, land brokers and farmers think land values will probably drop in the future. But, will the so-called land price bubble burst?