Land Values Climb
Observers often look to land values as a key indicator of the underlying financial health of production agriculture. Here again, like other financial indicators, rising real estate values evidence a healthy farm economy. Figures from the USDA National Agricultural Statistics Service (NASS) released in late summer showed Nebraska’s average farm real estate value rose 21 percent in 2022 compared to 2021, hitting $3,750 per acre (including the value of buildings), a record high (Figure 4). Nebraska’s average cropland value of $6,000 per acre was up 21 percent and came on the heels of a 14 percent increase in 2021. Dryland crop ground increased 20 percent, equaling $4,800 per acre. The value of irrigated land rose just over 22 percent, swelling to $7,950 per acre. Pastureland lagged crop ground but still posted an increase of just under 15 percent, growing to $1,240 per acre.
More recent data from the Kansas City Federal Reserve Bank showed land values during the third quarter were up 22.5 percent for non-irrigated cropland, 18 percent on irrigated ground, and 19 percent for rangeland compared to 2021. Figures released last week from Farmers National Company reported the average price for high quality land in Nebraska at $12,000 per acre, up 20 percent from last year. At one time last fall, Nebraska had the highest-priced land sale in the nation. A tract of ground in Richardson County sold for more than $27,000 per acre. However, it was soon to be eclipsed by a sale in Iowa. Nebraska got the last word though when the Huskers defeated the Hawkeyes in football in November and again a few weeks ago in basketball.
The spike in real estate values is the sharpest seen in almost a decade. Higher prices, greater returns for producers, strong producer demand for land, and fewer tracts up for sale have all contributed to the spike. It’s hard to foresee the double-digit growth continuing in 2023. Lower returns, higher interest rates, and drought will weigh on the market. But it should be duly noted, Tidbits said the same thing a year ago.
Figure 4. Nebraska Average Land Value

USDA NASS