What factors will cause land to crash or appreciate in your area?

[furrowtickler]

Not sure how much more it can appreciate here but it seems to keep going up. Last land sale was $480,000 per 1/4 . But then again that is deemed low compared to some areas.
The only thing that may temporarily depreciate land values is higher interest rates ?
Some bigger farms faultered here again this winter but others continue to expand .
Land prices setting new highs as well as rents . But management is a key driver not so much crop prices or crop condition. The average guy simply scratching their head saying Wtf ?
If only a guy had a crystal ball and a financial position back in the early 2000’s.
Like sayfly stated a new Hut colony has moved in and popped up land prices south west of here. Not sure how long lasting that will be.
But at end of the day , for now , the fight for land continues .

[SASKFARMER3]

Funny sure crop areas good land holding how will this work if rain ends on the west side.

One thing is certain if I was offered over 525 per quarter I would be gone lock stock and barrel.

No question asked here’s the keys Bye Bye.

[farmaholic]

There is no ****ing way land will pay for itself here in the Slum of the Ghetto, even at the reduced prices compared to what some other land is selling for in other areas. Was doing math this morning on a $320K quarter(145 acres open), with 25% down over:

15 years, $23220 annual payment, $160 per acre net earned to make payment
20 years, $19360 annual payment, $133 per acre
25 years, $17135 annual payment, $118 per acre

The fifteen year term doesn't seem even remotely possible 9 years out 10.

A twenty five year term brings the total cost(80K down payment and 240K loan @5%) to $528,385. I sure hope asset appreciation makes up for the $188,385 interest cost over the term of the loan assuming interest can stay at 5%. Add in 10% income tax paid on corporate dollars on the purchase price.... another $32,000.

Hello.... subsidize it. Where the **** is this making sense anymore? Reset time?

But I might be dumb enough to do it.

If you can pay cash, the acquisition cost is the initial price plus the $32K in income tax paid. From $550K down to $352K......WOW.


Furrow, has the criminal activity affected "some" of the rural land prices in that area?

[furrowtickler]

Farma - no it has had no effect.
This new property rights thing raises an eyebrow though.

[farmaholic]

Bucket, Don't forget to add in the cost of storage 😠

[Rareearth]

Scrap supply management = lower land prices

[grefer]

The biggest threat to land prices is if the NDP get back in and reverse land ownership rules. Back to the eighties.

[farmaholic]

If you're not selling, do land prices mean much, unless you like using it's equity to borrow against?

So if you're buying, low is good,.

Selling....looking for the most..

Depending which side of the transaction you're on determines what you want.

I wouldn't feel confident enough to crystallize my gains and sit on the sidelines waiting for a huge correction to buy back in though. I've been wrong too long already but now would be the time that _____________________.

[Guest]

There is no ****ing way land will pay for itself here in the Slum of the Ghetto, even at the reduced prices compared to what some other land is selling for in other areas. Was doing math this morning on a $320K quarter(145 acres open), with 25% down over:

15 years, $23220 annual payment, $160 per acre net earned to make payment
20 years, $19360 annual payment, $133 per acre
25 years, $17135 annual payment, $118 per acre

The fifteen year term doesn't seem even remotely possible 9 years out 10.

A twenty five year term brings the total cost(80K down payment and 240K loan @5%) to $528,385. I sure hope asset appreciation makes up for the $188,385 interest cost over the term of the loan assuming interest can stay at 5%. Add in 10% income tax paid on corporate dollars on the purchase price.... another $32,000.

Hello.... subsidize it. Where the **** is this making sense anymore? Reset time?

But I might be dumb enough to do it.

If you can pay cash, the acquisition cost is the initial price plus the $32K in income tax paid. From $550K down to $352K......WOW.


Furrow, has the criminal activity affected "some" of the rural land prices in that area?

farms , if you are paying cash , it's quite easy to get 2.3-2.5% interest on a 2 yr term . that is $8k /yr on a $350k price tag or $50/ac that you're not getting . usually when things won't work on paper , they won't work very long .

[farmaholic]

farms , if you are paying cash , it's quite easy to get 2.5% interest on a 2 yr term . that is $8k /yr on a $350k price tag or $50/ac that you're not getting . usually when things won't work on paper , they won't work very long .

Then is there no way to justify buying at these prices?

If it was compared to a "stock's" P/E ratio..... who would buy then?

[furrowtickler]

If Captain Crayon keeps pushing his agenda , land prices just may crash in the next two years .

[Guest]

. only as "my dick is bigger than yours " sentiment . but having said that , we would probably buy another one for the stupid price , because we can , and not a lot of other stuff we need . I don't know , it's a tough call, but it sure as hell doesn't work ?
many on here say that they never regretted buying any of their land , but I sure did for about 10 long years in the eighties and early nineties . lucky grant helped us with the interest or would probably have not made it . and we were to stupid and proud to just walk away like a lot of nieghbors and then buy it back for 10 cents on the dollar. that's not happening again .
there is no better asset

[ajl]

If Captain Crayon keeps pushing his agenda , land prices just may crash in the next two years .

Or it goes way up because the loon is worth less that the bolivar.

[AlbertaFarmer5]

I attempted to summarize the responses to the thread. Of unique posters who offered an opinion, I read 7 who see more reasons for it to continue up, and 6 who see more reasons for it to continue down. that sounds like a well balanced market, with equal participants on both sides. But then we are all(mostly) farmers, and tend to have an optimistic bias, otherwise why would we be doing this, or buying an asset with such a long term payback to start with right?

I know the banks certainly aren't as optimistic, lending criteria for bare land are much more stringent than in recent history.