Farm real estate—including land and structures—is forecast to account for about four-fifths of the total value of U.S. farm assets in 2020. (See more on farm assets and debt, including real estate.) USDA's annual June Area Survey indicates that farmland values began rising in 1988 and, except for single-year declines in 2009 and 2016, have continued rising. After adjusting historical data for inflation, however, farmland values did not begin to increase until 1993, and between 2016 and 2020 were 1.3 percent below their 2016 level on average. To recognize the impact of changes in the purchasing power of the dollar, all value-based comparisons that appear below use inflation-adjusted historical data. There is a regional variation in both farmland value levels and growth trends. The USDA Economic Research Service studies trends in farmland values, assessing the impact of both macroeconomic factors (such as interest rates and the prices of alternative investments) and parcel-specific attributes (such as soil quality, government payments, rural amenity value and urban proximity). U.S. farmland values remained high in 2020, averaging $3,160 per acre, a small decrease of 0.8 percent compared with 2019. At the same time, farm income was forecast to increase nationwide in 2020 (see Farm Income and Wealth Statistics for details). This, combined with historically low interest rates, contributes to the ability of the farm sector to support farmland values.
Regional farmland real estate values vary widely because of differences in general economic conditions, local farm economic conditions, government policy, and local geographic conditions that affect returns to farming. For example, in the Corn Belt, farmland real estate values are nearly twice the national average, while farmland real estate values in the Mountain region are less than half the national average. See the USDA, National Agricultural Statistics Service (NASS) website for a map and list of the States in the farm production regions discussed below.
|Region||Farm real estate value||Cropland value||Cropland rent||Pasture value||Pasture rent|
|U.S. total (48 States)||$3,160||$4,100||$139||$1,400||$13|
|Source: Land Values, 2020 Summary, USDA, National Agricultural Statistics Service, August 2020. Annual data by region and State are available from QuickStats.|
Farmland real estate growth trends also vary by region. For example, between 2019 and 2020, inflation-adjusted farm real estate values fell in the Northern Plains (down 3.1 percent to $2,120) and the Lake States (down 1.6 percent to $4,860). In contrast, farm real estate values appreciated in the Southern Plains (up 1.1 percent to $2,110) and the Mountain States (up 0.9 percent to $1,240). Between 2016 and 2020, farmland values increased the most in the Pacific States (11.3 percent), and fell the most in the Northern Plains (-10.0 percent).
Farmland real estate values vary according to agricultural use. Cropland maintains a premium over pastureland due to mostly higher per-acre returns to crop production. Between 2019 and 2020, U.S. average cropland and pastureland values both fell by 0.8 percent, to $4,100 and $1,400 per acre, respectively.
The difference between cropland and pastureland values also vary by region. Cropland values are higher than pastureland values in every region except for the Southeast. In the Pacific region, cropland was worth four times as much as pastureland in 2020 ($7,240 vs $1,750.) Since 2016, cropland values have risen the most in Pacific States (6.5 percent), while they have fallen the most in the Northern Plains (-11.7 percent). Over the same timeframe, pastureland values have increased the most in the Southern Plains (3.5 percent), and have fallen the most in the Corn Belt (-6.2 percent).
Rental rates measure the value of using land for agricultural production. Between 2019 and 2020, average U.S. cropland rental rates decreased by 1.5 percent to $139. Cropland rental rates increased the most in the Southeast (up 5.4 percent to $94 per acre) and the Delta States (up 2.8 percent to $115 per acre). Cropland rental rates fell the most in the Appalachian States (down 2.7 percent to $101 per acre) and the Northeast (down 1.9 percent to $88 per acre). Since 2016, cropland rental rates have increased the most in the Pacific (17.4 percent), and have fallen the most in the Lake States (-7.8 percent).
Pastureland rental rates have fallen 0.8 percent nationally since 2019. Since 2019, pastureland rental rates increased the most in the Mountain States (up 6.7 percent to $5.70 per acre) and the Appalachian States (up 6 percent to $23.50 per acre). Pasture rental rates fell the most in the Lake States (down 13.4 percent to $27.5 per acre) and the Northeast (down 7.1 percent to $29.50 per acre. Since 2016, pastureland rental rates have increased the most in the Southeast (up 3.2 percent), and have fallen the most in the Lake States (-18.5 percent).
Links to key farmland value data sources:
- Historical data on selected statistics on farm real estate, 1950-95, by State.
- Historical data on average gross cash rents and rent to value rates, 1960-94, by State.
- Recent data on land value and rent through NASS' QuickStats.