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If you need help setting up services or accessing your accounts, please call our Customer Care Team at 866.552.9172 during business hours (7 a.m. — 5 p.m. PST, M-F) or email us at CustomerCare@AgWestFC.com.
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If you need help setting up services or accessing your accounts, please call our Customer Care Team at 866.552.9172 during business hours (7 a.m. — 5 p.m. PST, M-F) or email us at CustomerCare@AgWestFC.com.
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Strong demand from operators and investors coupled with low inventory levels continue to elevate agricultural land prices.
Persistently high interest rates have decreased affordability and increased the use of creative financing options, such as owner-carry (previous owner of the property carries the note rather than a bank). Investors from out of the area or those with 1031 Exchange funds (tax-exempt funds for real estate investments) are competing for land when available. Limited supply may be distorting land values and/or delaying any changes in the market.
Sales value and volume
The volume of agricultural land sales in the Northwest continues to fall year over year, largely due to limited supply. The relatively limited volume of verified land sales indicates stable to increasing values. Land values in Oregon and Idaho are flattening due to a greater share of low-quality properties available than high-quality properties.
Average Land Values Per Acre, Northwest
Source: AgWest's propriety sales database. Industrial site sales excluded. Data collection lags about six months and is subject to change.
Land value considerations
Interest Rates – Higher interest rates are one of the most frequently reported deterrents to land acquisition coupled with low inventory. See our Quarterly Economic Update for a more in-depth analysis.
Residential – The housing market in most areas has cooled, largely due to high interest rates. A cooling market may lead to fewer developments and alleviate upward pressure on agricultural lands, particularly those surrounding population centers; however, that impact has yet to be seen as agricultural lands remain in high demand.
Availability – Inventories of agricultural land are low throughout the region, which continues to bolster values despite elevated interest rates.
Farm Income/Commodity Prices – After reaching record highs in 2022, USDA forecasts farm-sector income will decline by 25.4% in 2023. While this may disincentivize prospective buyers, the correlation between land values and commodity prices in recent years has been weak as many perceive land as a stable, long-term investment. The 2023 outlook for commodities in the Northwest is mixed, but no negative impact on land values has been seen.
Drought – Good snowpack last winter and spring rains brought relief to drought-stricken areas throughout the West. Year-to-date precipitation levels throughout the Northwest range from 77% to 140% (see map below). Storage water and irrigation conditions were generally favorable through the 2023 growing season; however, approximately half of the Northwest territory saw drought conditions in late summer and into fall. There are significantly fewer areas under severe, extreme or exceptional drought than in September 2022 (see maps below).
Drought Classifications, Western States
Source: University of Nebraska, U.S. Drought Monitor.
Year to Date Precipitation, Northwestern States
Source: NRCS National Water and Climate Center. Data as of September 27, 2023
Washington
Oregon
Montana
Idaho
AgWest appraisers provide appraisal services on rural properties throughout our territory. This Snapshot covers sales and market data from Idaho, Montana, Oregon, and Washington.
This report provides a high-level look at trends and market characteristics and does not provide detail for specific areas or land types. The report should not be used to identify a value for a specific property. This information is limited only to an analysis of trends in identified land values within the specified geographic area served by AgWest Farm Credit.
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