Indiana farmland prices hit record highs over the last year, according to the latest survey from the Purdue University Department of Agricultural Economics. The survey shows top-quality farmland averaged $12,808 per acre between June 2021 and June 2022, up nearly 31% over the prior 12-month period.
According to the annual Purdue Farmland Value and Cash Rents Survey, the average price of average-quality farmland also increased by 30.1% to $10,598. Poor quality farmland prices saw the biggest jump, increasing 34% to $8.631.
“Multiple factors are influencing the increase in farmland prices, including positive net farm incomes, relatively strong commodity prices, inflation, and high farmer liquidity,” Todd Kuethe, the Schrader Endowed Chair in Farmland Economics Purdue and author of the survey, said in written remarks. “However, rising interest rates are associated with increased costs of borrowing, which put downward pressure on purchases financed through mortgages.”
The survey shows statewide cash rental rates also increased to their highest levels across all land quality classes since the 2011-2022 period.
Average cash rents rose by 11.5% to $300 per acre for top-quality land, 10.8% to $252 for average-quality land, and 13.2% to $207 for poor-quality land.
Purdue says the price appreciation rates for farmland transitioning out of agricultural production or sold for recreational purposes also hit record growth rates.
The Purdue Farmland Value and Cash Rent Survey is conducted each June. You can connect to the full survey results by clicking here.