Could the “hot” farmland market be cooling?

In line with much of the country, farmland real estate was a hot market in Illinois last year, but those highs are not likely to stay.

“We see a lot fewer farms being auctioned off and on the market the first couple months of 2023 than we did the first two years. I think without question we can already say there will be fewer transactions to analyze for this conference next year than we were just able to analyze. In fact, with this latest addition, we had the most farms to analyze results from that we’ve ever had. So I think it’s not a robust market. I mean, you picked up some of those publications last year, Farmweek, and it felt like they almost had to add like an extra paper to cover all of the auctions. You’re certainly still seeing those, but not nearly as much, and that’s a common comment across the state,” said Luke Worrell.

Nationwide, real estate specialists with the Steffes Group suggest farmland values have peaked. There is a lot more demand for land than there is cash, and they note farm finances are generally strong, but input costs are still causing concerns.