Multiple Aspects Have An Impact On Agricultural Land Values Over the Past Year; Economist Relates

Nebraska average agricultural land values have been stagnant and fairly even across all eight districts, an agricultural economist explained.
Anastasia Meyer of the University of Nebraska-Lincoln Center for Agricultural Profitability presented a landlord/tenant workshop.
Note: the Southeast District encompasses Johnson and Nemaha counties; as well as: Clay, Fillmore, Gage, Jefferson, Nuckolls, Otoe, Pawnee, Richardson, Saline and Thayer counties.
As of Saturday, Feb. 1, 2025, average land value in the Southeast District was $7,170 per acre. The following cash rents paid per acre are 2025 estimates: non-irrigated cropland, $212 in Nemaha County and $194 in Johnson County; irrigated cropland, $298 in Johnson County and pasture, $52 in Johnson County. Meyer noted in the latter two instances in Nemaha County, not enough surveys were submitted to determine numbers. 
Additional 2025 season average rental rates per acre in the district are as follows: dryland cropland, $190; gravity irrigated cropland, $280; center pivot irrigated, $335; pasture, $63; cow-calf pairs, $65.45 and stocker, 500 to 600 pounds, $44.30 per head.
“Our data is only as good as the information we receive back,” the economist stated.
Meyer noted a variety of factors influenced 2025 agricultural land values. 
Those on the positive side include current livestock prices, purchases for farm expansion, the tax rule allowing real estate investors to defer capital gains taxes on investment property sales by reinvesting proceeds into a similar property, amount of land offerings for sale, federal farm program payments, irrigation water availability, returns to alternative investments and United States general economic conditions. 
Negative impacts are financial health of current owners, expectations for U.S. farm exports, property tax levels, future property tax policies, farm input costs, interest rate levels and current crop prices.
Agricultural flex lease arrangements information needs to be in writing. Every single flex lease varies from one party to another, she continued.
Factors for flexing cash lease payments, all in percentages, are: crop revenue, yield vs. price, 43; crop price, 37; crop yield, 15 and other, 5.
Reported crop price for flexing cash leases, all in percentages, are: local cash (spot) price, 48; crop insurance price guarantees, 24; futures prices, 17; terminal or regional price, 6 and other, 5. Those take away any chance of misunderstanding among the parties, Meyer said.
The economist called adjusting survey data, cash equivalent from crop share and return on investment as methods for estimating the base rental rates. The question for the tenant is what is the maximum he or she can pay. The landlord needs to consider what is the minimum he or she is willing to accept.
“You and your tenant have to have good communication,” Meyer related. 
U.S. Department of Agriculture (USDA) Farm Service Agency (FSA) regulations on farm program payments mandate a cash lease include any specific guarantee of price or division of crop within reason for a region, she stated.
“You have to take your lease to an FSA office to determine if you have risk,” the economist noted.
The Auburn office is at 918 26th St. Suite A. The Tecumseh office is at 448 N. 12th St.
As the tenant and landowner, you need to decide on when payment is made, Meyer explained. Final yield is unknown until after harvest. You need to decide when a minimum is due, one time or split it up over the season, paying installments in the spring, summer and at harvest. She preferred seeing cash leases split.
The Nebraska Farm Real Estate Survey has been conducted since 1978. Respondents are agricultural appraisers, professional farm managers and bankers engaged in the land industry. Meyer noted it is released annually around March 15. Actual land values and rental rates may vary depending upon the quality of the parcel and local market forces for an area. 
The USDA’s National Agricultural Statistics Service surveys farmers and ranchers on cash rent biennially. It starts in late winter and continues through midsummer of odd-numbered years. Analysis is published around the second week of September.