Farmland Value Trends and Drivers

• farmland
• land values
• markets

What drives farmland values?

Economists often describe land as worth the present value of the income it can earn. That means farm income, rents, interest rates and expectations about the future all matter. When incomes rise or rates fall, land tends to be worth more, and the opposite can push values down.

Other forces matter too: how many acres come up for sale, who is buying, nearby development, and rules on conservation or water.

Government programs and policy can also play a part, since payments and rules shape farm income and land use.

• Farm income and rents
• Interest rates and credit availability
• Supply of land for sale
• Buyer demand, including non-farm buyers
• Local factors like water, soils and development pressure

Where can you find reliable value data?

USDA's Economic Research Service has a farmland value topic page with data and explanations, and USDA NASS publishes land value surveys by state. Federal Reserve district banks and land-grant universities publish regional surveys. Use more than one source, and note the date of each.

No figures are given here because values change, and the official pages carry the current numbers.

If you read news summaries, go to the source page and read the original release for the full context, including limits and caveats.

Why do values differ so much from place to place?

Land in one county can be worth a multiple of land a few counties away, because of soil productivity, rainfall, irrigation, crops, markets and nearby cities. National averages hide those differences.

Cropland, pastureland and irrigated ground also behave differently. Look at the category that matches your land and your area before drawing conclusions.

A parcel's access, drainage and size also affect price, even within one county.

How do interest rates and credit affect land?

Land is often bought with borrowed money, so changes in lending terms can shift what buyers can pay. Lower rates can raise bids, and higher rates can cool them. Lenders also tighten or loosen standards depending on farm incomes and risk.

If you hold land debt, think about how a rate change would affect your payments, particularly with adjustable loans. Ask your lender about fixed and variable options and what happens at renewal.

Be careful about using value reports to argue for or against a rent increase. Rents and values do not always move together, so use both rent surveys and your own crop budget.

What should owners and buyers do with this information?

Do not try to time the market. Instead, test whether a purchase works at a conservative price and under stress, such as lower income or higher rates. Make sure the land earns enough to cover costs without relying on appreciation.

Owners considering a sale, a loan or a transfer to the next generation should get a current appraisal from a qualified appraiser rather than relying on headlines or neighbors' stories.

• Stress test the payment under lower income
• Get a professional appraisal for big decisions
• Use several data sources and check dates
• Avoid pressure to decide quickly

What mistakes should you avoid?

Assuming past increases will continue, borrowing the maximum a lender offers, ignoring property taxes and upkeep, and comparing your land with ground that is not like yours are common errors. Another is treating a single auction price as the market.

Remember that values can fall as well as rise, and that a price drop can affect your borrowing capacity even if the farm continues to earn a profit.

How do you read a land value report carefully?

Check the date, the geography and the land class first. Then see whether the figure is an average of survey opinions, actual sale prices or appraisals, since each behaves differently. Survey-based numbers may lag turning points, while sales data can be thin when few parcels trade.

Read the narrative too. Reports often explain what lenders and appraisers are seeing, such as changes in credit conditions or buyer types. Compare at least two sources for your region and ask your lender what they are seeing locally.

Avoid forecasts presented as facts. Nobody knows future prices, and a careful report will say so.

• Is the figure a survey, sales data or an appraisal?
• Which land class and which area does it cover?
• How old is the data?
• Do other sources agree?

Last reviewed: November 12, 2026. Written by the Farm Money & Grants Editorial Team. Educational only, not tax, legal or financial advice. See our editorial policy.