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Land Resources / News / Minnesota
Western MN Farmland Values Increase Slightly
Source: Dakota Farmer
February 26, 2010 
Western Minnesota farm land values continued to rise last year and are once again reaching all time record levels, according to a survey conducted by David Bau, University of Minnesota ag business management education. However, the 2009 increase was only 0.8%, compared to 30% in 2008.
Surveyed counties include: Chippewa, Cottonwood, Jackson, Lac qui Parle, Lincoln, Lyon, Martin, Murray, Nobles, Pipestone, Redwood, Rock, Watonwan and Yellow Medicine.
There was a great deal of variability in the change in value from 2008 to 2009. The largest increase was 26.8% in Lac qui Parle County. Cottonwood County experienced a decline in farmland values of 36.7%.
Four counties experienced declines in farm land values. The two counties with the largest declines, Cottonwood and Lyon, were those with the largest percentage increases from 2007 to 2008. Assessed values became closer to sale values.
"How high can farm land values go?," Bau asks. "Supply and demand will determine this. The simple return on investment, determined by rental rates, will determine how competitive farm land is compared to other investments. If interest rates rise or farm rental rates fall, the value of land is sure to be affected in a negative way. Barring those scenarios, the price of farm land will continue to climb. "
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