June 20, 2012

Farmland Values – Will the Boom Turn Bust?

Table of Contents

  1. What is a Bubble?
  2. Farmland Values and Fundamentals
    1. A Historical Perspective on Nominal and Real Gains
    2. Increasing Value‐to‐Rent Multiples
    3. A Historical Perspective on Sector Returns and Asset Values
    4. Falling Interest Rates
    5. Returns and Values: The Case of Indiana
    6. Are the High Multiples Sustainable?
  3. The Role of Expectations
  4. What Do Farmland Investors Say?
  5. Attitudes toward Valuation
    1. Someone Else will Pay More
    2. Value‐to‐Rent Relationship
    3. Future Values and Incomes
    4. Where to in the Future? Multiples
    5. The Link between Commodity Price Expectations and Values
  6. Summarizing the Survey Results
  7. Conclusions
  8. References

 

Read and download the PDF of the full paper prepared for the 2012 Agricultural Symposium.

 

*Download the slides from Dr. Gloy’s presentation at the 2013 Top Producer Seminar on this article. ​

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