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Where does farmland go from here?

Lower crop prices and concerns about rising interest rates seem to be dampening the enthusiasm for farmland right now. 

But many of the speakers at last week’s Land Investment Expo in Des Moines maintained that farmland is still a good long-term investment.

“I think land has historically always been a good investment, and I think it will continue to be,” says Ron Beach of The Peoples Company, a real estate investment firm and sponsor of the Expo. “We could see a little bit of a pull-back here.  In fact, we’ve already seen some of that.  But I would say it’s more of a leveling off. 

“We’ll catch our breath and see where it goes from here.”

AUDIO: Ron Beach (4:46 MP3)

Iowa businessman Bruce Rastetter, CEO of the Summit Group, says he’s still bullish on farmland long-term.

“I think you’ll see a pause in the land market here for a short period of time,” Rastetter says. “But I think over the next 10 years, over the next 20 years—just as it has over the last 50 years—it will give you a greater return than the S&P.  And it will do it with less volatility.”

Rastetter says farmland is a great inflation hedge.

“As we think about the U.S. debt, and at some point having inflation, owning real assets is important,” he says.

AUDIO: Bruce Rastetter (:44 MP3)

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