The U.S. lost a total of 1.9 million acres of farmland in 2022 according to the USDA.
“Historically, we’ve always lost acres to residential development. And that’s still the case,” says Eric Sarff, the President of Murray Wise Associates, which handles auctions and sales for farmland.
He says new housing additions are continuing to pop up on what used to be farmland, which was a trend that started before interest rates started climbing.
“Coming out of COVID, a lot of people had a lot more freedom to move around and work remotely, and that combined with low interest rates at the time really fueled a lot of builders putting up new housing developments and that does continue to take out farmland,” says Sarff.
He also says renewable energy companies are also buying up significant amounts of farmland.
“Solar and wind development has, at least in the Midwest, really increased their footprint,” according to Sarff. “The wind development taking up a smaller footprint for each turbine, but they are spread out over a larger region, where the solar is a much tighter footprint, but it takes out typically entire field.”
He adds that more farmland is being sold off today as younger generations are deciding to not keep their family farms.
“Typically, farmland gets passed down from one generation to the next and doesn’t ever come up for sale,” says Sarff. “As we see more land continuing to get taken out of production, that just puts more of a premium on the ground that comes to the market. Even when we were maybe a little bit of a softer market in 2017 through 2019, demand was still strong just because the supply was still so low. When something comes on the market, we still see a lot of demand for those properties.”
Sarff says the higher values that are being paid for farmland has been a huge motivating factor for those wishing to sell.
“Values are holding strong despite raising interest rates,” says Sarff. “We’ve had multiple sales where we’ve had 30-plus bidders registered for a sale, and that’s, to be honest, stronger than we’ve probably ever seen, and we’ve had up to 50 vendors in a room. And some of that’s due to offering online bidding now, which makes a lot more convenient for bidders. The result is the same. The demand is extremely strong still for farmland. In the Midwest, we’ve had good sales, and in other parts of the U.S. as well, and demand is really strong across the board.”
Since the year 2000, 50 million acres of farmland have been lost across the U.S. That works out to 4.3 acres of farmland lost every minute of every day.
Click BELOW to hear C.J. Miller’s news report—including audio from Eric Sarff, President of Murray Wise Associates, as he discusses the reasons why nearly two million acres of U.S. farmland were lost in 2022.
Source: NAFB News Service.
