Agricultural Economics Department
Date of this Version
7-1984
Abstract
Farm real estate values across Nebraska continued to decline even further during 1983 and into 1984. Nebraska farmland values have now trended downward for more than three and one-half consecutive years. For the year ending February 1, 1984, farmland values decreased more than 8 percent. Moreover, a special mid-year survey for 1984 indicates that the average land values have declined another 8 percent since February 1. Continued financial problems in the farming sector have forced many owners to put their land on the market. Coupled with little demand among potential buyers, this increased number of land tracts offered for sale has contributed greatly to a weaker land market and falling sale prices.
In nominal terms, current land values are comparable to those values reported five to six years ago. However, after adjusting for inflation, the real dollar value (constant dollar or purchasing power)is comparable to land value levels of ten years ago.
Land values in Nebraska peaked 1n early 1981 after nearly a decade of unparalleled appreciation. From this peak level, farmland values as of mid-May 1984 have declined an average of 28 percent across the State.
During 1983-1984, value declines have occurred in virtually every part of the State and for all types of farm real estate. Between February 1, 1983 and mid-May 198·:+, the largest percentage declines have occurred in the Central and Southeast Crop Reporting Districts with nearly 20 percent decline" The smallest drop, 11 percent, occurred in the Northeast District. In geneTal, cropland values for both dryland and irrigated land decreased 13 to 15 percent across the State during the 16-month period. Relatively larger declines, however, were reported for rangeland and pasture, dropping 18 to 20 percent in value.
Comments
Publication of the Department of Agricultural Economics, Report # 139, July, 1984. Website address is: http://www.agecon.unl.edu/realestate.html
The authors express their appreciation to the survey reporters for their participation in completing and returning the Nebraska farm real estate market survey questionnaire. Without their efforts and interest, the availability and publication of the data within this report would not be possible. Special thanks is also extended to the Federal Land Bank of Omaha for providing the farmland sales data for Nebraska.