The Wall Street Journal recently reported that home prices rose an average of 10.4% over the last year. Sometimes numbers can be misleading.
For our broad farm market including anything 5 acres or more, the average price has increased from $438,144 to $513,900 over the last year. On paper, this looks like a 14.7% increase in purchase price. In realty, farm values are rising but a much slower basis than the average makes it appear. The total sales volume for the farm market has increased from $108,659,796 to $142,350,269. The total volume is skewing the average higher but the reality is that average sales price for farms under $500,000 has gone from $186,821 to $193,266, the average sales prices for farms between $500,000-$1,000,000 have actually fallen from $716,326 to $678,014, and the average selling price for farms over $1,000,000 is basically unchanged from $1,878,002 to $1,881,360. Numbers can be misleading is the moral of the story.
Please give me a call if you need help figuring out the market.