By the Premier Farm Credit Appraisal Department
Land values fluctuate each year. The overall number of land sales in northeast Colorado was down last year. Our team at Premier Farm Credit keeps track of land values and trends in our six-county region. Look at the most recent trends through 2024:
Sprinkler Irrigated Values
Sprinkler irrigated cropland values have steadily increased in recent years. All counties have seen a relative increase, except for Yuma County, over the last three-to-five-year period, with some ups and downs throughout the analysis. The decline in values in Morgan County in the 2021-22 timeframe may have been due to more frequent sales in the Kiowa-Bijou basin in recent years, rather than more sales with good quality irrigation water. The two terms after this period in Morgan County have seen more sales with better quality water and is evidenced by the increase in sales price per acre. Water rights/supply will continue to be the major driver of irrigated land values. Changes within the Republican River Basin, if any, could impact irrigated land values substantially. The Republican River Water Conservancy District has mentioned within the next four to ten years, they will be decreasing the number of wells used so that they can meet their obligation to Kansas and Nebraska, as well as increasing their fees associated with the land in the district. This could impact values negatively in the immediate years, and positively in the long run. There is no current sales information available to support an adjustment for RRWCD water concerns. This information may take a few years for a potential benefit of conservation efforts to be reflected in the market. Increasing dairy influence in Morgan and possibly Logan County is likely to keep upward pressure on irrigated values.
Dry Cropland Values
While dry cropland values in most areas of the territory have retracted from their all-time highs from 2014-2015, the rate of decline has slowed, if not stopped. All counties except Logan and Morgan County have seen an overall increase in dry cropland values in the past five years, while each of the counties has shown both ups and downs during the analyzed time frame.
Pasture Values
Pasture values have increased for the most part over the past five years across the entire territory. The trend appears to level off overall, with some areas seeing larger increases and/or decreases depending on the area, and there is a consistency in the average values throughout the territory. There is still adequate demand as operators continue to seek grass for the expansion of existing operations.
Conclusion
As noted throughout the report, buyers are becoming more selective and marginal properties seem to show the sharpest declines in value. On the contrary, top quality land in certain areas shows little to no decline in value, while some areas with quality land have seen increases since the previous analysis. Within the most recent two terms, and especially the second half of each term respectively, the wet spring and early summer throughout the territory have likely improved many buyers’ outlook and may have influenced sales prices in a positive manner. Many well-established operators still seek to increase their land base for future generations that have returned to the family farm in recent years.
Premier Farm Credit has three certified and experienced appraisers. If you or someone you know needs agricultural land appraised, please reach out to our appraisal team at 970-848-5839.
