$3,100 an acre for pasture? Land prices soaring
Land is a finite resource, and in Marion County, auctioneers and brokers are seeing higher-than-usual prices for it.
A roughly 80-acre swatch of pasture land at 310th and Upland Rds. recently sold for $3,100 an acre — almost $250,000. The buyer was from Dickinson County and paid cash.
“People just haven’t been able to find pasture in their home counties,” Gene Francis and Associates broker and auctioneer Lori Rogge said. “We had a lot of interest in that auction. All the bidders were within a three-county radius.”
Jeremy Sundgren, an associate broker at Sundgren Realty in El Dorado, said his firm had been “very pleased” with recent auction results.
“We’ve seen a good strong increase in prices over the last three years,” he said. “I would guess that over the last two to three years, there has been anywhere from a 20% to 45% increase depending on what it is and where it is.”
That’s not stopping buyers, Rogge said.
“They’re still buying because they have to. If I miss out, I miss out, and I have nothing,” she said.
Sundgren said much the same.
“Another thing that drives these land prices is low inventory,” he said. “We’ve seen a low inventory environment for several years. A lot of these ag producers keep their land generationally. Sometimes it’s their only chance to buy, so they’re willing to pay more.”
Cropland fetches more money than pasture land, both auctioneers said.
Sundgren’s company has sold 22 tracts of land in the county since Jan. 1, 2020.
“We really enjoy working up there — good people in Marion County,” he said.
Rogge said her company recently sold about 120 acres in Morris County not too far from the land it sold at 310th and Uplands Rds. for about $3,000 an acre.
“I anticipate it will probably linger around there. I would be surprised if it goes much higher,” Rogge said.
That price is what buyers would have paid for cropland a year ago, she said.
“Crop ground is $3,500 to $4,000 an acre if irrigated or river bottom,” she said.
Sundgren said his company is mostly selling cropland — tillable tracts.
“The good large pasture tracts seem to be in pretty strong hands right now,” he said. “There’s not a lot of sellers in that market right now.”
Some people, he said, are looking for an alternative investment.
“Most of our buyers tend to be in agriculture production already. Some of them are just looking for an alternative source to put their money,” he said.
Scully Partners LP in Hillsboro owns about 40,000 acres of land in Marion County and some in Dickinson County.
Ryan Suderman, land manager there, said, “Oh, I would imagine” when asked whether Scully was one of the biggest landowners in the county.
He said he’d heard anecdotally about prices going up.
“We’re seeing inflationary pressure all over the place,” he said.
Scully leases land to local farmers at a per-acre price. Cropland is more expensive.
Lease prices are evaluated annually, he said. Farmers have year-to-year leases. Prices vary.
“One piece of dirt is going to vary from the next piece of dirt based on productivity,” he said.
Suderman would not disclose what Scully charges its tenants.
It leases land to more than 80 farmers and ranchers.
“We have some that are generational. Their grandparents and parents” rented from Scully,” he said.