WABASH, Ind. — Farmland values continue to strengthen in Indiana, according to Howard Halderman, president of Halderman Real Estate Services.
Where land prices go in 2023 depends on farm incomes, interest rates and supply, he said during a webinar.
“We had a record year last year with farm incomes, inflation adjusted,” he said. “So, that’s bullish. Interest rates are bearish. While not historically high, they are up. And supply of farms for sale — we had quite a bit back in the fall, but not so much now. So, I list that as neutral.
“Long-term world demand fundamentals remain bullish for agriculture and therefore land prices. Cropland values are in an uptrend. We foresee that continuing. We just don’t expect it to be as dramatic as 2021 or 2022.
“We foresee timber, recreational and rural residential markets to be steady to weaker. The average to below average farms are the ones you really have to watch. They will sell at the lower end of the range.”
Halderman listed the following as reasons he is bullish about farmland values:
• Profitable prices means cash and liquidity.
• Low amount of debt versus assets in agriculture.
• Moderate supply of farms for sale.
• Future demand for biofuels.
• World population growth.
• Trade deals could help.
• Water resources and competition.