Grain land the new Sexy !!

[JDGreen]

Is this area specific or all over? We have the highest land prices in history in our area. Big investor money not interested at these prices but local farmers are phoning neighbors and trying to buy entire farm operations at these inflated values. You can find next to nothing for sale in productive well established areas. However now the crap nobody wanted before is all of a sudden fetching 125,000 plus a quarter. Does this all end the same way as it did in the 80's or is it somehow different this time? What about those that sold to the investor firms or are renting from them, are they facing substantially increased rates now as a result. I would be pretty nervous if i was a big renter as the rates have to reflect the FMV I would think. Im waiting for the rental war to start on some of those packages, should prove interesting over the next couple years. I am so sick of reading about the CWB tard operation that I thought we may find some useful discussion on another subject.

[mbratrud]

I think the only thing different now than in the 80's is the Government is not likely to let interest rates go to the double digits. Never say never but the seems like they are happy just letting inflation do its thing.

[agstar77]

Illinois corn land rent 300 - 350 per acre.

[bluefargo]

Good topic
There has been absolutely no land move in this area this year that I am aware of. Quite a bit moved last spring at what I would call 'almost reasonable' prices.($600-700) per acre.
I would like to know what land is worth here east of Saskatoon. Has been some investor land bought here but not like some places. Hutts in the area but they don't seem inclined to pay the big prices.

[hobbyfrmr]

Bluefargo, you touched on something in our area. The hutterites do not buy overinflated expensive land. Well..not yet. They have always been the threat, that they will "take over" and it creates a little hype for the regular farmers to pay more so the Hutts dont get it. One colony moved in here sometime in the '60s and bought land from those who wanted to sell. Lots of pasture, hayland and sandy land to utilize for their dairy, beef, chicken and hog ventures. Some good grain land obviously for canola etc. They learn to utilize the land they have for success.

[fjlip]

We paid $545/ cult acre last year on a low assessed quarter. Another 65000 assessed quarter went for over $700/ cult acre.
Investors bought the Lever farm near Muenster. Anyone heard or checked what was paid?
In this area the talk is the Cawkwell farm was sold to Hudye, anyone know more? Lots of land rented by Cawkwell Farms is up for rent. But it's so WET and scary here, few have the balls.

Thousands of acres of investor land near Quill Lake apparently was rented, were asking $60 land taxes bin rent.

[fjlip]

Should read $60 plus land taxes plus bin rent.

[farmaholic]

JDGreen:
You make the same point I've been talking about in this area. In the early 80's some fairly high prices(for this area at that time) were paid for land. When interest rates rose and commodities fell, the land price went with the commodities. Some just let it go, some let it go and exercised right of first refusal and some just hung on. It would have taken til just recently for those values paid in the 80's to be realized again. Even if interest rates don't go up again but commodities fall it might not make sense to pay too much. I feel we may be at that point again. When the world bumper crops come back, and they likely will, commodities will fall again(but I think the bar has been raised). So unless there is alot of "old money" laying around, you have deep pockets, or can subsidize the purchase with "paid for" land, I would exercise some caution. When I buy land I hope that in time it appreciates in value and not have to keep it 20 years to just get out what I paid for it, interest expense and income tax(land is paid for with after tax dollars) aside.

Maybe it's telling us something if the land investment companies aren't willing to pay these prices. If its not a good investment for them is it for me? Rent is also an interesting scenario, if it is a percentage of the price paid for the land........

[bucket]

It seems odd that people are buying out guys for inflated prices when the current operator is just staying above water. Although some of these guys have used the farm debt review board to get where they are. Meaning they never really paid for anything.

Is it the volume that makes it work?

Because if a guy has the kind of money it takes to buy a farm why not find another investment with a lot less work/risk?

[Hopperbin]

The lever farm plus quite a few more neighbours land probably about 40 quarter in all maybe a lot more. Sold for 900 per acre based on crop insurance acres insured. They don't pay for under water land, that gets thrown in. But they are going to get a big surprise this spring. There are going to be a shit load of these acres under water, most land well drained, no trees, just a few without an outlet, tempting to sell them one myself, if I would not have it fertilized I think it would be gone. Just I would like to talk to this company about a trackhoe ditch but they prefer to be unknown at the moment. Plus I want to make sure one neighbours deal is finalized first. I heard they are banking on 3 percent return from rent not sure if that is after land taxes, probably. The new renter comes from 20 miles away it is believed. Not farmed locally.

[mbratrud]

Heavy Land from West Side Weyburn, Yellow Grass, Milestone and into Pense, trading at $190,000 to $240,000 per Quarter, East 75,000 to 100,000 for lighter Land. 2006 it was less than half that. Might be the same lever farms is running rent and prices up here as well. Cash rents are getting out of touch as well. The stakes are certainly getting higher.

[fjlip]

Hopper, are those the ones who traded 5 one year old NH TJ's, 2-134' sprayers and 2-74' 5710's with 700 carts at Jay Dee Humboldt for green stuff?