The largest increase in land values occurred in the east-central and southern Red River Valley regions with both increasing over 20%.
Despite high production costs to start 2022, net farm incomes remained high helping facilitate a sharp rise in land prices for 2023, says Bryon Parman, North Dakota State University (NDSU) Extension agricultural finance specialist.
The statewide average land price increase from 2022 to 2023 was 13.46%, which is higher than last year’s increase of 10.9%. Rents were also up considerably, rising 6.82% statewide, marking the largest increase in 10 years.
The data for the rental rate and land value changes comes from the North Dakota Department of Trust Lands County Rents and Prices Annual Survey found online at https://www.land.nd.gov/resources/north-dakota-county-rents-prices-annual-survey. The data is then combined into NDSU Extension regions using a weighted average based on the number of county acres.
The largest increase in land values occurred in the east-central and southern Red River Valley regions with both increasing over 20%. The north-central and northeastern regions saw the next largest increase at 15.5% and 14.1%, respectively. The south-central and southeastern regions increased between 11.5% and 13.5% for the two regions. Smaller increases occurred in the southwestern region at 9.4% and the northern Red River Valley which increased 6%. The northwestern region tends to fluctuate a bit more due to a lower number of observations, showed the only decline at -0.84%.
“Overall, the statewide average cropland value moving into 2023 was $2,863 per acre,” says Parman. “The most expensive farmland in North Dakota remains in the southern Red River Valley region at an average of $5,494 per acre while the least costly is in the northwestern region at $1,399 per acre.”
Over the last five years, the southeastern region cropland values have surpassed the northern Red River Valley, with the southeastern region increasing faster. In the most recent survey, the southeastern regional land values were $3,886 per acre while the northern Red River Valley values were $3,605 per acre.
The east-central region was also over $3,000 per acre for the first time, coming in at $3,029. The other three regions including the north-central, northeastern and south-central all came in between $2,100 per acre and just over $2,300 per acre. The southwestern region came in just above the northwestern region at $1,653 per acre.
Source: ndsu.edu
Photo Credit: GettyImages-oticki
Categories: North Dakota, Crops